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Matthew S. Bothner, Joel M. Podolny, and Edward Bishop Smith

What is the best way to design tournaments for status, in which individuals labor primarily for the esteem of their peers? What process, in other words, should organizers of status-based contests impose upon those who covet peer recognition? We propose a formal model of status-based competition that contrasts two competing alternatives. The first, following Merton, is the “Matthew Effect,” according to which a tournament’s architect directs slack resources to elite actors and thus widens the distribution of rewards by favoring cumulative advantage. The second is the “Mark Effect,” under which a tournament’s designer instead pushes slack resources to marginal actors and thus tightens the distribution of rewards. Our results suggest that although the Mark Effect is better for the social welfare of most tournaments, the Matthew Effect is preferable in two distinct contexts: in small tournaments where variation in underlying ability translates into acute advantages for the most capable contestants; and in large tournaments whose contestants face constant, rather than rising, marginal costs—a condition we relate to contestants’ perception of their work as intrinsically valuable. Our contributions are twofold: We find, counter to the thrust of Merton’s work, that cumulative advantage is not invariably optimal for the functioning of status contests; and we identify circumstances in which the production of superstars is likely to make contests for status better off in aggregate. Implications for future research on status and management are discussed.

Management Science, 57 (2011): 439-457

When Do Matthew Effects Occur?

Posted by admin in 2010 - (Comments Off)

Matthew S. Bothner, Richard Haynes, Wonjae Lee, and Edward Bishop Smith

What are the boundary conditions of the Matthew Effect? In other words, under what circumstances do initial status differences result in highly skewed reward distributions over the long run, and when, conversely, is the accumulation of status-based advantages constrained? Using a formal model, we investigate the fates of actors in a contest who start off as status-equivalents, produce at different levels of quality, and thus come to occupy distinct locations in a status ordering. We build from a set of equations in which failing to observe cumulative advantage seems implausible and then demonstrate that, despite initial conditions designed to lead inevitably to status monopolization, circumstances still exist that rein in the Matthew Effect. Our results highlight the importance of a single factor governing whether the Matthew Effect operates freely or is circumscribed. This factor is the degree to which status diffuses through social relations. When actors’ status levels are strongly influenced by the status levels of those dispensing recognition to them, then eventually the top-ranked actor is nearly matched in status by the lower-ranked actor she endorses. In contrast, when actors’ status levels are unaffected by the status levels of those giving them recognition, the top-ranked actor amasses virtually all status available in the system. Our primary contribution is the intuition that elites may unwittingly and paradoxically destroy their cumulative advantage beneath the weight of their endorsements of others. Consequently, we find that the Matthew Effect is curtailed by a process that, at least in some social settings, is a property of status itself—its propensity to diffuse through social relations. Implications for future research are discussed.

Journal of Mathematical Sociology, 34 (2010): 80-114