Consuming Contests: Outcome Uncertainty and Spectator Demand for Contest-based Entertainment
60 Pages Posted: 10 Feb 2021 Last revised: 12 Jan 2022
Date Written: February 7, 2021
Contests that non-contestants consume for entertainment are a fixture of economic, cultural and political life. We look to professional sports and exploit injury-induced changes to teams' line-ups to examine whether individuals prefer to consume contests that have more uncertain outcomes. Using data from the Australian Football League, we find that a one standard-deviation increase in game outcome uncertainty causes, on average, an 11.2% increase in attendance. Our results extend research on contest design and information preferences by showing that spectators strongly prefer evenly-balanced contests and appear to derive entertainment utility from suspense and the resolution of uncertainty.
Keywords: Contest design, information preferences, consumer demand
JEL Classification: Z20, L82, L83, M55
Suggested Citation: Suggested Citation