Loss Aversion in Professional Golf

Abstract

We examine loss aversion in the context of professional golf at US Open tournaments. In particular, we analyze data from two courses, Pebble Beach Golf Links and Oakmont Country Club, where they have hosted six and five US Opens, respectively. The United States Golf Association changed the par rating of a hole on each course from a par 5 to a par 4, without fundamentally altering the hole, in each US Open hosted by these courses since 2000. In this natural experimental setting, we find evidence of significant loss-aversive behavior in the world’s best golfers based solely on par rating.