Competition as a Public Health ProblemBy Pauline Vaillancourt Rosenau, Ph.D.

ProfessorManagement and Policy Sciences E-915

School of Public Health1200 Herman PresslerHouston Texas 77030

(713) 500-9491 Fax: (713) 500-9493E-mail: pauline.rosenau@uth.tmc.edu

Prepared for presentation at the Annual meeting of the APHA, Philadelphia, November 2002

A B S T R A C T

The objective of this paper is to review existing research and specify the known public health consequences of various types of competition. The results of such a review suggest that competition is not as benign as has been commonly assumed. Certain forms of competition may have quite serious negative effects on human health and productivity. The dynamic by which they do so are known and have been extensively studied - for example, they increase stress at the individual level. Destructive competition may also exacerbate already existing inequality among individuals, within societies, and between countries. Increased inequality is one of several social determinants of health. While commonly assumed to generate incentives for increased productivity, scholars in several academic disciplines have called the evidence for such an effect into question. Organizations that restrict the level of internal competition are more productive and appear to have a more stable, more highly motivated workforce. A substantial portion of the population has been found to be more likely to function to full capacity where the level of competition is moderated. To assure that all individuals are provided the opportunity to lead healthy lives and produce to their full capacity requires reconsidering common educational practices and workplace organizational structures. Similarly at the global level limiting destructive, winner-take-all forms of competition may be necessary if all nations are to develop to full capacity in the long term and contribute to a healthy and productive international environment. There is little evidence that the current forms of unrestricted global competition maximize the health of populations or improve productivity.

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Competition as a Public Health ProblemBy Pauline Vaillancourt Rosenau, Ph.D.

“The invisible hand conjures ill health along with wealth” (Burris, 1997, pp 1607-8).

Experts suggest that competition maximizes societal well being by eliminating

less competitive players from the field. It is efficient, making the most goods available at

the least price (Osborne & Gaebler, 1992; Scherer, 1994). Competition is assumed to yield

the best, meanest, leanest systems of production with the least waste, whether it is among

individuals, groups, organizations, corporations, or nations (FitzRoy, Acs, & Gerlowski,

1998; Van Hooff, 1991). It is praised for increasing productivity, rewarding innovation,

encouraging each individual to perform to his or her utmost, wringing out excess market

capacity, lowering costs, increasing organizational efficiency, raising standards,

distributing what a society produces more adequately, protecting the public from

government bureaucracy, promoting learning, and stimulating advancement in science and

education (Bengtsson, 1998; Cronbach, 1963; Horowitz, 1968; Rich & De Vitis, 1992). It

is thought to bring about needed change and to end bureaucratic rigidity (Osborne &

Gaebler, 1992). Competition is even said to build character and improve interpersonal

relations (Shaw, 1958). Experts agree that competition works its magic without reference

to ethics or philosophy.

But even if this view is true, none of it is without costs including public health

consequences. This is especially the case if public health is defined in broad terms. Public

health’s mission as Charles-Edward Winslow put it in 1920 is the “fulfillment of society’s

interest in assuring the conditions in which people can be healthy “ (Gostin, 2000, quoted

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on p.309; Institute of Medicine, 1988). This means everyone has a standard of living

appropriate to the maintenance of health and the condition in which every citizen may

realize her or his birthright of health and longevity (Hanlon & Pickett, 1984). It brings into

public health a population health perspective. It introduces socioeconomic status,

inequalities, early childhood development, education, employment conditions, and social

support systems into the public health equation (Terris, 1986, see p. 55 for cite).

Certain forms of competition interfere with the achievement of public health goals

in several ways. These are examined below, but not all forms of competition are the

same in terms of their impact on human health and productivity. Some are benign or even

beneficial while others are destructive. Much depends on how competition is employed

to allocate society’s resources; how it rewards winners and sanctions losers. Competition

was not designed to redistribute society’s wealth. Where that is the public-health-

relevant goal other means are better suited to the task.

Sometimes the effect of competition on health is direct. This is the case with

regard to stress. But the ways in which destructive competition constitutes a public

health problem are often overlooked because the dynamic involved is often indirect and

subtle. For example, destructive forms of competition increase social inequality, a

concern of population health approaches to public health. Here competition’s influence

takes place indirectly, via the social determinants of health.

Winning and losing at each level, be it the individual, the group, the organization,

the corporate entity, or the nation, is not random (Gorney, 1972). Under conditions of

unrestrained competition, results are predictable. This is because at the outset,

competitors seldom starts at a point of equality. Some have more resources, attributes,

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and wealth than others. Even those attesting to the virtue of the invisible hand in the

marketplace agree that “one cannot explain the pattern of output or results in any market

system by pointing exclusively to market transactions, for the pattern is always a result of

both the transactions and the prior determinations taken together” (Lindblom, 2001,

p.171). The rewards of winning are often cumulative (Frank, 1985, p. 4).

Eventually, and in the absence of any outside interventions, competition increases

differences and sustains a negative spiral of winning or losing, thus generating even greater

levels of inequality. As the process moves along over time, it leads to big winners and

continual losers. Competition continues, and too often, the winners, often at the expense of

the losers in previous competitive encounters, influence the terms of play. People become

discouraged when they repeatedly lose (Campbell, 1982; Drucker, 2001, p.11). The

intrinsic motivation to try and put forth one’s best effort is reduced by losing over and over

again (Deci & Ryan, 1985). Repeated losers, be they individuals, organizations, or

societies, have poorer health (Lynch, Kaplan, & Shema, 1997) and lower productivity.

Lower societal productivity is a matter of public health concern when it means that a

substantial portion of the population cannot maintain a standard of living sufficient for

health and longevity. In the end everyone is worse off, because even when a minority of

the population is unable to work to their full capacity, because of psychological or physical

health impediments, the quality of life is compromised for all members of society. The

same dynamic plays out at the global level where unrestricted competition increases

inequality between the developing and the developed countries.

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Different Kinds of Competition

Efforts to define competition and to distinguish among its various forms are few.

Certain types of competition are more likely to have negative health effects rather than

others. Competition can be structured in various ways and each has significant but

different consequences. Goal-oriented competition encourages each player, each person, to

do their best and to work with others to achieve an objective. An example is how the World

Health Organization encourages each country to set time-specific national goals for

improving population health and then strive to attain those goals. Each country is

competing with itself to reach national health objectives (U.S. Department of Health and

Human Services, 1992, 2001). Inter-personal competitiveness is not so benign because it

emphasizes doing better than others, winning over others for its own sake (Morey &

Gerber, 1995).

Johnson and Johnson suggest that there are important differences as well between

zero-sum competition and appropriate competition (Johnson & Johnson, 1989; Johnson &

Johnson, 1994; Stanne, Johnson, & Johnson, 1999). Zero-sum competition involves the

distribution of rewards on a “winner-take-all” basis. This means that I win, you lose.

Appropriate competition seeks to maximize personal well-being, improve overall societal

productivity, and advance global community. It is associated with four characteristics.

First, winning must not be so important that it generates the extreme anxiety that interferes

with performance. Second, all participants in the competition must see themselves as

having a reasonable chance to win and thus remain motivated to give it an honest try, their

best effort. Third, the rules of the competition need to be clear and fair as to procedures and

criteria for winning. Finally, those competing should be able to monitor how they are doing

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compared to others. This feedback may, in fact, be more important than actually winning

(Johnson & Johnson, 1989).

Destructive, excessive, or unfettered competition seems to be associated with

serious, negative, though sometimes unintentional, side effects.1 Examples of destructive

competition include cutting costs by polluting the environment, “competing” by reducing

worker safety and protection measures, or competing at socially irresponsible, damaging

financial speculation. Destructive competition drives out constructive competition. For

example, “Firms will not be able to compete at the skillful management of the production

process if they are undersold by firms that are competing at evading waste-treatment costs”

(Johnson & Johnson, 1989, p32-33). Groups, individuals, and countries practice destructive

competition when they win by cheating on the rules—or when they cheat more than their

competitors. In the business world--many aspects of public health are conducted as a

business in United States today--destructive competition is about price wars that benefit

those who have the resources to outlast others, some of whom may be more efficient than

the survivors (Swisher, 2000). Destructive competition involves undercutting standards,

and manipulating or exploiting others. Examples include stock market manipulation, tricky

accounting mechanisms, confusing fares and fee schedules, deceptive advertising,

marketing ploys, and less than truthful sales promotions. It lends to the exploitation of

vulnerable populations who may be too trusting or who simply lack alternatives

(Culbertson, 1985, pp. 27-28).

1 Competition can also be described as either constructive or destructive though such descriptions are not a definition (Culbertson, 1985). To define competition solely in terms of its effects would constitute circular reasoning. The terms destructive and constructive are adjectives not nouns. They are employed here to help distinguish the negative aspects of competition from its positive dimensions, not as mere post-facto labels.

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Stress, The Individual and Health Status

Accumulating evidence links destructive competition to stress and stress, in turn, to

ill health. Many forms of stress appear to increase the risk for disease and death. At the

molecular level stress effects have been closely studied in the last 50 years. These can be

devastating. The link between competition and stress is of more recent interest(Rosenau,

2003).

At the biological level, competition-generated anxiety and stress reactions disturb

normal hormonal processes especially as regards those who lose. If pushed to the extreme

limits, biological self-correction mechanisms are overridden. Hormonal imbalances persist

on an almost permanent basis. This reduces the ability to do well in future competitive

situations (Campbell & Furrer, 1995). Stress, high anxiety, distraction, and low

concentration all diminish the probability of winning even more. At the same time, winning

increases the desire to compete again. All these processes contribute to the self-reinforcing

spiral of destructive competition at the biological level.

Competition Increases Stress

Exactly how stressful social processes like competition affect human health at the

biological, molecular level is not fully understood though promising hypotheses abound

(Wilkinson, 2001). Learning more about the precise chemistry of the wear and tear on the

body’s cells and the acceleration of the aging process are central to this research topic.

Social stress is thought to upset the equilibrium of the neurological, endocrine, and immune

systems (Brunner & Marmot, 1999; Everson, Kaplan, Goldberg, Salonen, & Salonen,

1997; Marshall et al., 1998; Sapolsky, 1996). The independent regulation of these systems

and their joint interaction are disturbed by too much stress. Stress interferes with the

autonomic nervous system and its huge network of intricate activities, including heart rate

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and breathing that are all so carefully coordinated in normal circumstances. The

hypothalamic-pituitary-adrenal axis of the endocrine system is similarly affected. In short,

stress plays havoc with our hormones.

Competition-related stress-effects in humans have been studied in different

contexts. The effects of stress are greater when the competitive pressure is increased, and

are higher in actual competitive conditions than in sports training sessions. Intense

competition leads to acute abnormal elevation of heart rate and blood pressure (Fenici,

Ruggieri, Brisinda, & Fenici, 1999; Kerr & Pos, 1994)2. Highly competitive educational

situations generate stress effects on individuals. Twelve percent of medical students

experience stress, attributable in good part to competition, to the point of psychiatric

disorder (Liu, Oda, Peng, & Asai, 1997). For many individuals, stress increases with a

variety of other competitive educational experiences, including classroom presentations

followed by formal evaluation (Bristow, Hucklebridge, Clow, & Evans, 1997).

Stress Has Consequences for Health Status: At The Biological Level

Almost all antecedents of stress that affect health outcomes do so in a complex

fashion (Staw, 1984) and competition is no exception. Biological research indicates that

when destructive competition increases stress, it leads to hormonal changes that effect

metabolic and physiological processes that in turn influence health. Stress can protect and

restore the body, but it can also damage it, with severe consequences in certain cases

(McEwen, 1998; McEwen & Stellar, 1993). Some individuals are more susceptible to

2 It is the competition aspect of sports that generates stress, not physical exercise itself. In fact, regular non-competitive physical exercise has been found to counteract stress and facilitate positive psychological health (Wankel, 1993). It is recommended for those who want to improve health and have a better overall quality of life. Some believe that exercise actually increases longevity though the evidence for this benefit is far from certain.

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negative stress effects than others.3 However, at higher levels of stress, such as those

associated with destructive competition, almost everyone suffers some harm. Mild levels of

stress may improve performance, encourage creativity, and promote innovation. But

prolonged, unremitting stress is likely to be dysfunctional (Anonymous, 1997, p. 396;

Gordon, 1991; Herbert & Cohen, 1993; Welford, 1965).

Biological, physical reactions to stress are normal and healthy. But rapid return to

base line is essential if disease is to be avoided (Brunner & Marmot, 1999). Stress, if it is

positive, increases cardiovascular and catecholamine hormone responses but it only

temporarily raises cortisol levels. Stress is negative if it is due to intense fear and distress,

or if it persists over a prolonged period of time and becomes chronic. (Lovallo, 1997, p.

73). For some individuals, certainly a minority through repeated, over-stimulation the

inactivation mechanisms become inefficient. This has serious health consequences

(Bremner et al., 1997; McEwen, 1998; Syvalahti, 1987).

The most destructive forms of competition may cause the sympatho-adrenal pathway or the

hypothalamic-pituitary-adrenal axis (HPA) to overreact (Brunner & Marmot, 1999).

In the extreme, the health effects of very high levels of stress may include muscle

wastage, hypertension, impaired immunity (Marshall et al., 1998) and even infertility

(Lacour & Consoli, 1993; Sapolsky, 1990, p. 120). Lower stress levels have fewer

negative health effects on the immune system and endocrine system, but people vary a

great deal in terms of their reactions (Wilkinson, 1996).

3 ? In addition, individual hormonal reactions to competition and stress vary across the population, with some people being highly susceptible and others not, for a variety of reasons (Frost, Morgenthau, Riessman, & Whalen, 1986; Lovallo, 1997; Turner, Wheaton, & Lloyd, 1995). In humans, known characteristics are associated with stress sensitivity. These factors include early life experiences, personality, gender, marital status, age, occupation, and work environment(Rosenau, 2003)

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Stress raises cortisol levels, which may damage the hippocampus. Stress-related

increases in cortisol and beta-endorphins are probably associated with poor self-esteem and

affective instability (Zorilla, DeRubeis, & Redei, 1995).

In some humans, the stress that causes psychological problems is directly linked to

competition (Short, 1997). This suggests “individual differences in basal HPA-function are

associated with individual differences in psychological functioning following stress” (File,

1996; Zorilla et al., 1995, p 591). Stress-generated serotonin deficiencies appear to be

correlated with increased irritability, insomnia, and depression (Coppen, 1973). Stress-

generated endocrinological changes can increase or decrease the tendency to be impulsive,

aggressive, or even violent (Megargee, 1993). Increased cortisol is associated with

nervousness (Booth, Shelley, Mazur, Tharp, & Kittok, 1989; Mazur, 1994), depression

(Chodzko-Zajko & O'Connor, 1986; Loosen, 1976; Peeters & Broekkamp, 1994), and

impaired memory function (de Quervain, Roozendaal, Nitsch, McGaugh, & Hock, 2000).

Disruptions of hypothalamic regulatory function increase with elevated blood pressure for

older patients (Gotthardt et al., 1995).

The role of stress in heart disease appears to be as great as that of hypertension and

high cholesterol (Langer, Criqui, Feigelson, McCann, & Hamburger, 1996; Rozanski,

Blumenthal, & Kaplan, 1999). Observations of the same individuals over several years,

across many points in time, indicate that stress leads to an increased probability of

hypertension, cardiovascular disease, diabetes (Raikkonen, Keltikangas-Jarvinen,

Adlercreutz, & Hautenen, 1996), heart disease (Moyer et al., 1994), depression (Vanpraag,

1996), and mortality (Phillips et al., 2001). Laboratory experiments involving closely

controlled temporal relations have established a causal link between stress and reduced

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immunity [Bristow, 1997 #402; Glaser, 2000 #3088;(Kiecolt-Glaser & Glaser, 2001);

Kennedy, 1988 #3089]; stress makes individuals more susceptible to colds (Cohen, Doyle,

Skoner, Rabin, & Gwaltney, 1997; Cohen et al., 1998; Cohen, Tyrrell, & Smith, 1991;

Herbert & Cohen, 1993) and herpes (Glaser et al., 1999). The same type of time-limited

data shows that stressed subjects exhibit higher levels of cortisol. Increases in cortisol over

a 2 or 3 year period were correlated with declines in cognitive functioning for women but

not men (Seeman, McEwen, Singer, Albert, & Rowe, 1997).

Stress Related Competition in the Workplace: from the Biological to the Social

Losing in a competitive situation has documented consequences for health and

future performance and stress plays a role. Losing produces a negative self-evaluation

(Meeker, 1990). This also lowers immune responses (Strauman, Lemieux, & Coe, 1993).

Losing may even lead to social isolation, and this in turn is associated with negative health

effects (Coplan, Pine, Papp, & Gorman, 1997). Social isolation has been linked to

increased cortisol levels in animal studies (Levine, Lyons, & Schatzberg, 1997). In

humans, it reduces longevity, slows recovery from illness and injury, and is correlated with

increased severity of illness (Johnson & Johnson, 1989, p. 130). Much the same is true of

the hostility, cynicism, mistrust, and anger that result from competition-generated

psychological stress (Barefoot, Dahlstrom, & Williams, 1983; Barefoot et al., 1987;

Lovallo, 1997).

In addition, individual hormonal reactions to competition and stress in the

workplace vary across the population, with some people being highly susceptible and

others not, for a variety of reasons (Frost et al., 1986; Lovallo, 1997; Turner et al., 1995).

In humans, known characteristics are associated with stress sensitivity. These factors

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include early life experiences, personality, gender, marital status, age, occupation, and

work environment (Rosenau, 2003).

The most competitive work environments have the greatest biological effects

resulting in serious public health consequences. The precise aspects of the competitive

workplace that contribute to the stress, that in turn result in negative health effects, are just

beginning to be understood (Hinton & Burton, 1997). It appears that workplace conditions

are directly or indirectly associated with higher levels of heart disease and other

cardiovascular risks, especially for workers of a lower social class background (Marmot &

Theorell, 1988, pp. 672-3). Biological and social effects are intertwined. Work related

stress, including psychosocial stress, correlates with a whole host of negative biological

processes, including “hyperinsulinemia, hyperglycemia, dyslipidemia, hypertension,

increased abdominal obesity, and plasminogen activation inhibitor-1 (PAI-1) antigen

comprising the IRS (insulin resistance syndrome)” (Raikkonen et al., 1996, p. 1533;

Schnall, Schwartz, Landsbergis, Warren, & Pickering, 1998, p. 697).

A competitive and stressful work environment has indirect health consequences that

are sometimes counterintuitive. While it might seem logical that the most successful people

would be the most competitive and the most stressed at work because they have the most

demanding careers (high levels of responsibility and long hours) this isn’t always so

(Cavanaugh, Boswell, Roehling, & Boudreau, 2000). These powerful, high status

individuals have the ability to personally control the stress they encounter in life. The

opposite is true for those who hold lower level jobs. Here the individual has little autonomy

and must live with a high level of stressful uncertainty and competition (Karasek, 1979).

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Absence of job decision latitude, characteristic of low-paid positions, is similarly correlated

with higher health risks (Karasek et al., 1988).

At least two different scenarios offer possible explanations for this unexpected

result. Both involve the biology of stress. Both are intertwined with competition for

monetary reward or personal recognition though competition is unlikely to be the only

cause of this stress. First, individuals in the lower ranks may work very hard and yet

receive few rewards for their efforts. There is an absence of appropriate reward-for-effort.

Second, they may have little control over the work they do, how it is planned, and how it is

carried out. In both instances stress increases and health consequences follow

(Frankenhaeuser & Gardell, 1976; Marmot, Siegrist, Theorell, & Feeney, 1999). In fact,

“subjects experiencing high effort and low reward conditions and subjects with low job

control had higher risks of new coronary heart disease than their counterparts in less

adverse psycho-social work environments” (Bosma, Peter, Siegrist, & Marmot, 1998,

p.71). Over the course of a lifetime, mortality is 43% higher for those working in low-

control jobs (Amick et al., 2002). Research suggests that higher socioeconomic status

makes for greater life control, lower stress, and lower mortality (Karasek & Theorell, 1990;

Pollard, Ungpakorn, Harrison, & Parkes, 1996). High job demands and high competition

for status are less likely to be associated with negative stress effects, however, if the

individual has control of the work situation (Brunner, 1996; McEwen, 1998; Short, 1997;

Stokols, Pelletier, & Fielding, 1995).

Highly competitive markets lead to job loss that has biological effects resulting in

ill health. During times of economic boom, stress and health effects are lower than during

economic slowdowns because layoffs are far more common during periods of economic

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contraction (Hymowitz, 2001). Close to 50 studies completed in the 1980s and 1990s

confirm a strong association between unemployment and increased risk of morbidity

(physical and mental illness) and mortality (Brenner, 1995). The direction of causation has

been studied; it is more likely that job loss causes ill health and mortality than the opposite

(Jin, Chandrakant, & Svoboda, 1995). Even merely anticipating job loss has been found to

have negative consequences for health (Hurrell, 1998; Marmot et al., 1999). Competition-

generated unemployment, as with unemployment in general, is often involuntary. It is

related to increased stress levels, loss of confidence, reduced self-esteem and increases in

mental health problems, anxiety, and depression (Klunk, 1997; MacFadyen, MacFadyen, &

Prince, 1996; Theodossiou, 1998). The feeling of hopelessness that accompanies

unemployment may in turn also lead to serious negative health effects such as

arteriosclerosis (Everson et al., 1997). It results in higher suicide rates (Oswald, 1997).

While individual studies may be disputed, overall trends are clear. A spiral of

competition and the resulting negative biological health effects, often due to increased

stress, have significant consequences. At the biological level, the immediate costs of stress

and ill health resulting from competition may appear to be borne primarily by the

individual rather than the organization or society. For example, an individual may become

unemployed if she or he becomes ill or disabled due to stress or stress-related disease. The

costs of this negative spiral of competition are not always evident on the corporate

accounting sheet. But, when workplace competition generates stress, the consequential

health-related illness leads to absenteeism and higher job turnover. It increases the cost of

health services to the individual and to the employer who sponsors health insurance. A

large majority of doctor visits are thought to be stress-related, according to the Center for

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Corporate Health at Beth Israel Deaconess Medical Center. Employees who report greater

on-the-job stress have health expenditures that are 46% higher than those of other workers.

This was much more than the increased health expenditures attributable to tobacco use

(14%) and high blood pressure (12%) (Goetzel et al., 1998). Based on estimates from the

1980s, job stress costs $2,770 per employee per year (Matteson & Ivancevich, 1987).

The Public Health Relevance of Competition among Groups and Organizations

If public health involves assuring that all individuals be provided with the

opportunity to lead healthy and productive lives as Winslow’s definition above suggests,

then the competitive dimension of common educational practices and workplace

organizations structures needs to be reassessed. Research suggests that not all forms of

competition improve productivity in every circumstance (Anderson & Morrow, 1995;

Johnson & Ahlgren, 1976; Johnson, Johnson, & Anderson, 1978; Rosenau, 2003;

Zwanziger & Melnick, 1996). Therefore it does not necessarily contribute to attaining an

adequate standard of living for all.

Johnson and Johnson examined 521 studies of competition completed between

1899 and 1989. They concluded that, overall, cooperation produces higher productivity

and achievement than competitive or individualistic efforts (Johnson & Johnson, 1989,

pp. 19, 41). Only about ten percent of the studies assessed showed the opposite in this

ninety-year period. Another review article summarized research carried out between 1939

and 1993. It suggested that interpersonal competition is less effective than cooperation

for all subject areas and age groups, over a wide variety of tasks, including those

involving motor skills, decoding, recall of factual information, and problem-solving

categories that require a variety of different cognitive processes (Qin, Johnson, &

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Johnson, 1995). Cooperation within groups, combined with competition between these

groups, works better than competition alone. Research supports the finding that in

situations where groups compete with each other, achievement and productivity is greater

for those groups that practice internal cooperation (Johnson, Maruyama, Johnson, Nelson,

& Skon, 1981, p.57).

Where competition does increase productivity, it often diminishes quality

(Deutsch, 1949; Johnson, Johnson, & Stanne, 1985; Rosenau, 2003) and this too may

jeopardize a society’s standard of living and has public health consequence. Patient

mortality rates at hospitals in highly competitive markets are greater than in less

competitive markets (Shortell & Hughes, 1988). This indicates lower quality. In the highly

competitive health sector of the 1990s, about 28% of employers and over 60% of physician

group representatives say that “cost pressures are hurting quality” (Angell & Kassirer,

1996; Watson Wyatt Worldwide, 1998, p.2). Quality may be hard to maintain because in

such highly competitive health care provider markets, price and market share have been the

most important consideration.

Some of the public health consequences of unremitting competition undermine

health system performance. Sixteen percent of workers report that they are pressured to cut

corners and reduce quality control (American Society of Chartered Life Underwriters and

Chartered Financial Consultants & Ethics Officer Association, 1997, p. 7). Twenty-four

percent of primary care physicians indicate that the scope of care they are expected to

provide, now that the health system has become highly competitive, is greater than it

should be (St. Peter, Reed, Kemper, & Blumenthal, 1999, p. 1980). Intense market

competition means doctors are being asked to perform in medical specialties different from

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those in which they were trained (Grumbach, 1999). Patients do not receive optimal health

care, and rehabilitation therapy may be denied them to save money because competition is

so great (Retchin, Brown, Yeh, Chu, & Moreno, 1997). A comparison of Arizona’s

Medicaid managed-care program (organized around highly competitive bidding) with New

Mexico’s much less competitive, more traditional Medicaid program reveals substantially

lower quality in the Arizona program (McCall, 1997). The practice of “de-skilling” in the

hospital industry is adopted by many organizations in an effort to survive in the

competitive marketplace. But it reduces the quality of care and hospital worker safety

(Pindus & Greiner, 1997). De-skilling means downgrading the responsibilities of a job or

position. It also takes the form of hiring the employee with the lowest level of education

and training possible to do a job. This is worrisome when patient lives depend on a narrow

margin of error and good judgment is essential.

Few studies exist that discuss population distribution of individual ability to

perform under competitive conditions. But it appears that substantial proportion of the

workforce is more likely to function to full capacity only where the level of competition

is moderated. In short, some individuals, probably a minority, may actually thrive on

competition despite, for example, its potential long-term negative health effects

(Richerson, Boyd, & Paciotti, 2002). There are very few studies of addiction to

competition. In the context of the competition paradigm, such an addiction may even be

viewed as an asset rather than a liability. But to adopt this uncritical view would be a

mistake. When competition is addictive, withdrawal leads to depression, at least if what is

known from competitive sports is true of other areas of life (Tarkan, 2000).

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If all members of society are to be allowed to work to their greatest potential, to

maximize their personal contribution to society, then provision must be made for those

who work hard but do not function at their best in competitive circumstances, for those

who do better and are more productive in a cooperative incentive setting. Overall, “the

larger the proportion of the population able to participate productively…the greater the

likelihood of increased economic prosperity” (Keating & Hertzman, 1999, p. 15)

Destructive Market Competition and Organizational Structure and Practice

Common organizational practices have considerable public health consequences.

The health effects of competition-related downsizing on those laid off are an example.

Downsizing and layoffs make for lower worker morale (American Management

Association, 1994; Wyatt Company, 1993; Yankelovich, 1997) (Lester, 1998). Workers

who remain are often profoundly distressed, and they experience guilt, anger, anxiety, and

denial (Brockner, 1988; Sutton, 1990) (Gordon, 1991; Murray, 2001; Short, 1997). Such

corporate restructuring increases depression, despair, and detachment among those who

remain [Greenberg, 1995 #1108; (Wilkinson & Marmot, 1998). Unemployment suffered

by those fired has known negative health effects.

Employers believe that they will be more competitive if they employ temporary

workers. Temporary employees are thought to increase organizational flexibility (Davis-

Blake & Uzzi, 1993). They cost less because many do not have employer-provided health

insurance and other benefits (Casey, 1989; Christopherson, 1989); this reduces the

immediately-evident fixed costs of employment but undermines population health because

insurance is closely related to access to health services. Organizations that emphasize

temporary employment also have greater salary differentials that translate into higher

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turnover among their lower-paid employees (Pfeffer & Davis-Blake, 1992). Reduced

stability and duration of employment leads to poorer morale among employees (Cappelli,

1995, pp. 585-6)

Mechanisms designed to increase internal competition in the workplace are

widespread and of public health consequence because they have an impact on employee

mental and physical health. Such devices include performance reviews with ranking, merit

pay,“report cards” and competitive zero-sum grading schemes that set worker against

worker within an organization (Abelson, 2001) (Coens, Jenkins, & Block, 2000). Enron

consciously sought to encourage competition between its employees with its famous “rank

and yank” philosophy. John F. Welch Jr., former chairman and CEO of General Electric,

put it this way: “A company that bets its future on its people must remove that lower 10

percent, and keep removing it every year – always raising the bar of performance and

increasing the quality of its leadership” (Abelson, 2001, p. A1).

Evidence that internal noncompetitive workplace structures and incentives improve

performance comes from case studies in a range of different economic sectors, in several

different countries, for large and small companies, going back 50 years (Simmons &

Mares, 1983; Walton, 1972). Self-management and industrial democracy experiments

increased productivity between 10% and 40%. The Gaines Pet Food plant in Kansas

implemented such innovations and found, they increased output and reduced accidents. The

Volvo plant in Kalmar Sweden carried out numerous workplace experiments that increased

internal cooperation and gave workers more freedom and autonomy at the same time.

These arrangements increased efficiency and reduced absenteeism dramatically (FitzRoy et

al., 1998; Gibson, 1973; Gyllenhammar, 1977a, 1977b; Karasek & Theorell, 1990).

19

Workers organized into autonomous cooperative teams exhibited higher product quality,

lower absenteeism, and reduced turnover (Berggren, 1992, pp. viii-x; Management Review,

1972; Thierauf, 1982). In combination, high performance work practices have a multiplier

effect (Kruse & Blasi, 2000). Results are the same across many studies in different

circumstances (Baker, 1999). Even the most conservative estimates suggest that workplace

innovations that increase internal cooperation and that empower employees do not harm

employers (Neumark & Cappelli, 1999) (Cappelli & Neumark, Forthcoming). Only in one

specific situation, when the task is entirely independent, is competition as efficient in

promoting productivity as is cooperation. Because most of what we do in life is

interdependent rather than independent, intense competition is more often a minus than a

plus for individuals and groups.

Decreased Safety is a Public Health Concern

Destructive competition may make for lower attention to safety considerations in

the workplace and this is a substantial public health consideration. This may be due to a

decline in regulation or an increased drive for profit. If competition increases individual

stress, this would augment organizational accident rates due to inattention, carelessness,

and distraction. An organizational culture that “encourages individualism, survival of the

fittest, macho heroics, and can-do reactions” may seem desirable because it is more

competitive (Kaufman, 1999, p. C8), but it can also lead to disaster. On the other hand

workers trained to cooperate have better safety records (Orlady & Foushee, 1987).

Cooperation is said to be an essential skill in commercial sectors where dangerous activities

are common, such as the airline industry (Weick & Roberts, 1993, p. 378).

Intense competition between rival companies can offer an incentive to actually

create safety hazards. This happened in the utility sector in the U.S. In filings with the

20

Federal Energy Regulatory Commission, several utility companies charged that their rivals

suspended routine power deliveries over shared lines. The consequences for the customers

of these rival companies were enormous. This happened in the summer of 1998 when the

Midwest suffered repeated brownouts due to disruptions in transmission. While the official

reason for suspending deliveries was said to be a risk of an overload on the lines, others

interpreted it as an explicit attempt to damage the competitors. In either case, the indirect

result of this intense competition was harm to the competitor’s customers (Kranhold &

Emshwiller, 1998).

Experts worry about whether or not the intensely competitive market might have

contributed to some recent airline plane crashes (Nance, 1986, Ch. 5). Such speculation has

become common, supported by data from Federal Aviation Administration audits of major

airlines (Wald, 2002). In the case of the 1998 Swissair tragedy, journalists pointed out that

an American Airlines executive had taken over Swissair’s daily operations with an eye to

bringing experience from the U.S. competitive market to make Swissair more competitive.

“Like other European carriers, Swissair has faced an increasingly competitive business

environment as governments increasingly allow deregulation and airlines struggle for

passengers….” (Cushman, 1998, p. B6). A US Air accident on July 2, 1994, was attributed

to poor pilot-safety and training programs and trying to save money by neglecting required

repairs to aircraft (Frantz & Blumenthal, 1994). Deaths were reported to have been higher

because US Air “resisted retrofitting cabins” with new flame-retardant material because it

cost too much (Frantz & Blumenthal, 1994, p. A19).

ValuJet was under severe competitive pressure just prior to the tragic May 11,

1996, Florida crash (Brannigan & Abramson, 1996). To save money it skimped on

21

personnel training with regard to carrying hazardous materials. Poor maintenance-record

keeping probably jeopardizes safety as well (Wald, 1996). Schwartz points out that ValuJet

“offered very low fares yet had the highest profit margin in the airline industry” (Schwartz,

1996, p. 45). The hearings held later concerning the crash of ValuJet flight 592 revealed

that maintenance workers had been rushing and functioned under intense pressure to meet

deadlines and impress potential customers (Davis, 1996). A court case found the company

guilty and levied large fines, but the employees involved were not found guilty. Following

the January 31, 2000 crash of an Alaska Air plane off the coast of California, mechanics at

the Seattle maintenance facility said they had been “pressured, threatened and intimidated”

to cut corners (Verhovek, 2000, p. A25).

Loss of Trust and Lower Morale in the Workplace

A trusting environment is essential for human well-being and public health. Trust

is, however, a fragile commodity (Bok, 1999; Levi & Stoker, 2000). Many structural and

functional changes that accompany high levels of competition undermine employee trust

and morale (Uchitelle, 2001). These, in turn, translate into lower productivity and profits

(Pink, 2001). (American Society of Chartered Life Underwriters and Chartered Financial

Consultants & Ethics Officer Association, 1997). Distrust arises, as well, from the

surveillance procedures common in the highly competitive industrial workplace today

(Cialdini, 1996; Kruglanski, 1970; Strickland, 1958). “Because of psychological reactance,

even honest employees may try to cheat or sabotage monitoring systems” (Kramer, 1999,

p. 591; Prusak & Cohen, 2001).

Where employers make a commitment to employees in terms of a long-term

relationship, employees perform better and are happier (Cascio, Young, & Morris, 1997;

Drucker, 2002; Hurrell, 1998). They respond favorably to this type of employer allegiance

22

and are more productive (Tsui, Pearce, Porter, & Tripoli, 1997). Uncertainties about future

employment status and job loss are related to poor physical and psychological health of

employees (Ferrie, Shipley, Marmot, Stansfeld, & Smith, 1995, 1998). Surveys in Britain

and the U.S. indicated that unemployment takes a toll on an individual’s feelings of well-

being and happiness (Argyle, 2001; Blanchflower & Oswald, 2001). Even the fear of

unemployment has such effects (Di Tella, MacCulloch, & Oswald, 2001). This in turn

influences workplace morale.

Competition’s Worst Externalities: Psycho-Pathologies and Fraud Are a Public Health Problem

Studies also warn of largely unexpected public health relevant externalities of

competition. Controlling the worst side of human nature, the urge to destroy and injure

others is a public health problem. Psychopathologies, such as interpersonal hostility,

aggression, generalized violence, deception, cheating, and fraud, are all associated in

certain circumstances with too much destructive competition. The famous Robbers’ Cave

experiments of Sherif and Sherif found that aggression, hostility, and collective fighting

increased after 12-year-old boys were encouraged to play competitive games at summer

camp (Sherif, Harvey, White, Hood, & Sherif, 1961). In-group solidarity translated, in the

presence of competition, into out-group discrimination, hostility, and aggression (Sherif &

Sherif, 1953). One experimenter reported, “Sometimes intergroup antagonism grew so

intense that the experiments had to be discontinued” (Blake & Mouton, 1986, p.72; Sherif

& Sherif, 1953). The impact of competition-generated hostility and aggression was found

to be long lasting and difficult to reverse (Sherif & Sherif, 1970). Only imposed super

ordinate goals that required groups to work together toward a common objective improved

the relationship between the groups (Goldstein, 1994, p.100; Sherif et al., 1961).

23

Destructive competition can push organizations to resort to fraud and corruption

that are also directly and indirectly a public health problem (Labaton, 2001). Between 1992

and 1999 prosecutions against health care providers increased from 83 to 506 (Steinhauer,

2001). Fraud and the act of covering it up are illegal. Columbia HCA’s paid kickbacks,

falsified Medicare claims, upcoding the severity of patient illness when requesting

government reimbursement, and other criminal activities coincided with the full

development of market competition in the health sector (Eichenwald, 1997a, 1997b;

Gottlieb & Eichenwald, 1997; Lagnado, 2000; Rodriguez & Lagnado, 1997). Columbia

HCA ended up paying more than $800 million in settlement payments (Eichenwald, 2000;

Lagnado, 2001). Vencor, a corporate nursing-home-care provider, was also caught – in this

case for illegally discharging patients who ran out of money and had to move to Medicaid

coverage (Adams & Moss, 1998). Medicaid did not pay as much as private insurance and

therefore Medicaid patients were avoided. Tenet (when it was called National Medical

Enterprises) held patients “hostage” at its inpatient psychiatric hospitals, drugging them and

restraining them against their will, until the patients’ health insurance benefits had been

exhausted. The goal was to maximize revenue to the hospital even if this amounted to what

courts called kidnapping (Sharp, 2000).

Does intense competition lead to more mistakes, fraud and greater effort at cover-

ups? Most of the evidence is anecdotal, but it does suggest that this is the case (Vaughan,

1999). High pressure to produce may make for impossible goals resulting from stiff

competition. Medical care, again, is a good example. Hospitals that are not doing well from

a financial point of view have higher rates of adverse patient outcomes, patient injuries that

result from mistakes in medical management. During periods of intense financial

24

competition, such hospitals may not be able to spend enough on patient care to avoid

negligence (Burstin, Lipsitz, Udvarhelyi, & Brennan, 1993). Errors are found to increase

when nurse caseloads are unusually high. Stress and fatigue, high workloads, and time

pressures contribute to increased mistakes and higher error rates (Leape, 1994). Intense

competition exacerbates these conditions. Under intense competition, many teaching

hospitals affiliated with medical schools violate legal limitations on the number of hours a

resident can work. Tired residents make more mistakes (McKee & Black, 1992; Pear,

2000). Lower profits for pharmacies in a managed-care environment, together with longer

shifts, fewer breaks, and more pressure on pharmacists, are hypothesized to increase errors

in filling prescriptions (Sowers, 1996). There is another incentive to overlook medical

errors, according to Lucian Leape. Errors “generate revenues in a fee-for-service system”

(Leape, 1996, p. 3). But the cost of errors to hospitals can also be high (Bates et al., 1997;

Classen, Pestotnik, Evans, Lloyd, & Burke, 1997). Although the causes of mistakes and

errors in medicine have been known for years, little has changed and cover-ups continue

(Kilborn, 1999; Pear, 1999).

Mistakes and marginally unfair business practices can sometimes be profitable to a

corporation in a competitive environment, and when this is the case they may become

routine practice (Landau & Chisholm, 1995; Singer, 1978). For example, some managed-

care companies have routine policies of “deny, delay and down-code” regarding approval

of physician requests for patient procedures and reimbursement (Jackson, 2000). They

reimburse doctors later rather than promptly, upon receipt of a bill, deriving a fiscal

advantage over competitors. A study of hospital billing revealed that 99% of bills contained

errors, and most of these favored the hospital (Kerr, 1992; Rosenthal, 1993; U.S. General

25

Accounting Office, 1993). Mistakes increase where staff cutbacks result in inadequate

supervision of residents (McKee & Black, 1992). Pressure to meet deadlines and increase

productivity, higher under conditions of excess competition, result in more mistakes

(Riemer, 1976).

Global Competition and Public Health

The dynamics of the spiral of competition at the national and international levels

are, again, known and the public health consequences are apparent. A variety of

complicated mechanisms and self-reinforcing social processes appear to be at work. The

competitive process reduces the probability of financial investment in the poorest nations,

especially if uncertainty and future political unrest threaten. Less investment in poor

countries increases the likelihood of greater social and political uncertainty over time.

Inequality between the rich and the poor countries increases and it negatively affects

population health (Stewart & Berry, 1999) within many countries. At the same time

unrestrained competition increases the difference between the rich and the poor.

Competition Related Inequality As a Public Health Problem: Global and Societal Population health Consequences

The last half of the 1990s was a period of high economic growth, low inflation, and

low employment in the U.S. Yet, the gap between the rich and the poor failed to diminish,

in all but 5 states, even in this period of extraordinary prosperity (Bernstein, McNichol,

Mishel, & Zahradnik, 2000; Johnston, 2002; Schlesinger, Mabry, & Lueck, 1999). This

constitutes a marked change from the increasing equalization of income in the U.S., for

example, that began in the 1930s (Morris & Western, 1999). The fact that the

industrialized countries, assumed to be immune to rising inequality, are also experiencing

this trend is a surprise.

26

What is true at the individual level holds for the national level as well (Bergesen &

Bata, 2002). Convergence theories that posited that the productivity differences between

the rich and poor countries would diminish have not proven true in the 1990s (Baumol,

Nelson, & Wolff, 1994). Income inequality among countries is on the increase worldwide

(Faux & Mishel, 2001; International Monetary Fund Expenditure Policy Division, 1998;

Park, 1997; Sachs, 1999; United Nations Development Programme, 1997). Poor countries

are losing ground relative to richer countries. While World Bank analysts argue that

growth means everyone benefits from “seeing their incomes rise simultaneously at about

the same rate” (Economist, 2000a, p. 82), and, indeed, while the poor countries are doing

better than ever before, the disparity between the developed and the third-world countries

continues to rise. It was about 7 or 8 to 1 in 1977. Today some sources say it is close to 30

to 1 while others suggest it is 37 times higher (Mueller, 1999, p. 73; Seib, 2002).

The exact cause of the epidemic of increasing inequality observed within modern

industrialized nations and between rich and poor countries is not known. But destructive

forms of national and international competition may account for it, at least in part

(Levinson, 1996). Richard Freeman, professor of economics at Harvard, was quoted in The

New York Times, as suggesting “there is little doubt that market forces have spoken in favor

of more inequality” (Stille, 2001, p. A17).

The purpose here is not to argue that destructive competition is the sole cause of

increasing inequality in the developing countries. Scholars have suggested many reasons

for increased wealth or income inequality both within countries and between nations

though few of these explanations are independent of competition.

27

Destructive Competition Has Global and Societal Population Health Consequences

This appears to be a trade-off between equality and national competitiveness

ratings. This means that as countries strive for and achieve higher competitiveness ratings

(World Economic Forum, 2001) they pay the price of increased inequality. Increasing

national competitiveness appears to be associated with rising inequality even in many of

the highly industrialized OECD countries (Rosenau, 2003).

If increases in national competitiveness during periods of intense global

competition are related to higher inequality, then distinct population health costs result

(Daniels, Kennedy, & Kawachi, 2000). This is because increases in inequality are bad for

one’s health, not just at the individual level as observed in preceding chapters, (Okun,

1975) but at the societal level as well (Coburn, 2000). These negative health effects are

cumulative over time. The “health effects of sustained economic hardship …have

potentially important implications for public health, health care, and economic policy”

(Lynch et al., 1997, p. 1894). The effects are increased societal health care cost and lower

societal productivity (Poland, Coburn, Robertson, & Eakin, 1998, p. 789).

Inequality is linked to increased morbidity and mortality at the individual level

(Evans & Stoddart, 1990; Wilkinson, 1996). People with inequality-generated

disadvantage, real or perceived, are more likely to have poorer physical well-being,

reduced psychological health, and problems with cognitive function. However, they are

less likely to receive needed health care (Lynch et al., 1997, p. 1894). A number of studies

suggest that the rich have better health outcomes than the poor across a range of morbidity

measures, including coronary artery disease (Williams et al., 1992), infant mortality (Hales,

Howden-Chapman, Salmond, Woodward, & Mackenbach, 1999), and exposure to

28

environmental hazards (Blane, Bartley, & Smith, 1997). The relationship between health

and inequality holds for the young and for adults (Dahl & Birkelund, 1997; Lundberg,

1997; West, 1997). In addition, inequality itself is correlated with higher mortality, even

after controlling for other factors (Kaplan, Pamuk, Lynch, Cohen, & Balfour, 1996;

Williams, 1998).

These same negative effects of inequality on health are apparent at the global level.

The very poorest countries have the highest infant mortality rates while the wealthiest

countries have the lowest (Young, 1998). Though the exact mechanisms underlying these

relationships are not known, the findings have held up across countries and over time

(Acheson, 1998; Chiang, 1999; Doorslaer et al., 1997; Fox, 1989; Kunst, 1997;

Mackenbach & Kunst, 1997; Wilkinson, 1996). Studies suggest that the health status of the

population (as measured by life expectancy) predicts subsequent national economic growth

(Bloom & Canning, 2000). At the same time rapid economic growth is no guarantee of

improved population health. It may even increase disparities between the rich and poor as

regards health (Hsiao & Liu, 1996). While of greatest relevance for the developing

countries, even with the wealthiest of countries, such as the U.S., the effect of wealth or

health is apparent for different geographical areas (Kaplan et al., 1996).

While the poor suffer the effects of inequality most, in the end the health

consequences of inequality influence everyone in a society. Countries that pursue policies

to reduce inequality appear to improve population health and lower mortality rates, not just

for the poor but for the wealthiest as well (Hales et al., 1999; Vagero & Lundberg, 1989,

pp. 35-36; Wilkinson, 1997). In short, all benefit if inequality is reduced.

29

The purpose is not to argue that competition is the only cause of differences in

health status, via inequality. In fact, a range of factors are probably involved (Kunst, 1997;

Tarlov, 2000). But to overlook the possibility that destructive forms of competition play a

role is to minimize the public health cost of the competition paradigm to society.

Competition, Inequality, and the Negative Social Environment

Destructive competition is a public health problem for society as a whole because

of the hostile social environments associated with it. Such environments include social

breakdown in the form of regional economic impoverishment, community decline,

weakened family life, societal malaise, and increased crime (Luttwak, 1999). There is

evidence however, that only extreme forms of competition lead to desperation, hostility,

and aggression (Gordon, Welch, Offringa, & Katz, 2000). Though, of course such

problems do not develop only because of competition.

George Soros says that sometimes these negative consequences of destructive

competition are indirect and mediated through inequality (Bank, 2002). “Too much

competition and too little cooperation can cause intolerable inequities and instability”

(Soros, 1997, pp. 47-48). This linkage has been traced to the level of human psychology.

Inequality is related to higher hostility scores on the Minnesota Multiphasic Personality

Inventory. Hostility is in turn associated with poorer health and with higher death rates

(Wilkinson, 1999a, p. 62; Williams, Feagares, & Barefoot, 1995). It is also linked to high

coronary-artery problems, even in young adults (Iribarren et al., 2000). The links between

inequality and negative life circumstances such as chronic unemployment or increased

rates of imprisonment or doing without health insurance, have also been studied (Kaplan

et al., 1996).

30

Equality is central to the development and maintenance of civic community and the

public sphere. Certain patterns of inequality are associated with a poor quality of social life,

with political and social violence, and with rebellion (Midlarsky, 1999; Putnam, 1993, p.

105). These include violent demonstrations, assassinations, coups d’etat, and civil

outbreaks (Alesina, Ozler, Roubini, & Swagel, 1996; Hibbs, 1973; Venieris & Gupta,

1983, 1986). Edward Muller of the University of Arizona says that “High levels of income

inequality are likely to produce either high levels of rebellious political conflict…or else

the perception among elites of a threat of rebellious political conflict and lower-class

revolution” (Muller & Seligson, 1994, p. 647).

At the societal level inequality increases poverty. Poverty, in turn, is associated

with violence and crime (Curry & Spergel, 1988; Frank, 1999, pp. 299, 313; Taylor &

Covington, 1988; Wilkinson, 1999a), at least for a minority of those who experience

markedly diminished opportunities and increased frustration (Sachs, 1999; Todaro, 1997).

Increased income inequality is correlated with high arrest rates (Midlarsky, 1999). The

level of homicide is related to income inequality around the world (Wilkinson, 1999a). A

meta-analysis of 34 data-based studies confirms the link between income inequality and

crime especially as regards homicide and assault (Hsieh & Pugh, 1993). Without

intervention and over time, the worry is that a permanently deprived and under-productive

group of nations, societies, or regions could develop and divisions increase (United Nations

Secretariat, 2001).

Ironically, in the long run the negative social environment that results from

destructive competition may reduce a country’s productivity. “To the extent that people are

busy either committing crimes or trying to avoid being victims of them, they are diverted

31

from producing legitimate goods and services” (Frank, 1999, p. 24). High levels of

violence and crime compromise the business environment (Barrionuevo & Herrick, 2002).

In addition, societal resources must be spent on increased security staff, on home and

business monitoring systems, and on the incarceration of 1.7 million Americans. “The

lower the level of trust and co-operation, the more expensive it gets” (Wilkinson, 1996, p.

229). Economists estimate that spending on anti-terrorist security in the U.S. constitutes a

measurable and continuing drag on the economy (OECD, 2002; Rhoads, 2002).

Anthropologists have observed that nonviolent cultures place less emphasis on destructive

competition (Bonta, 1997). A study of 58 societies indicated that societal competitiveness

is directly related to psychological distress and aggression (Gorney & Long, 1980).

Where there are few limits to competition, people may feel they have no choice but

to pursue self-interest without regard to the consequences, especially if survival is at stake.

In these cases, the weak often pay the cost. For example, an increase in destructive forms of

market competition in Eastern Europe and Russia had an especially negative impact on

women and children (Economist, 2000b). Women experienced increased unemployment,

less economic independence, lower wages, poorer health outcomes, and fewer social

services. They suffered higher levels of rape, prostitution, and domestic violence,

concurrent with the rise of destructive forms of competition. Women and children lost

many of their equity-based gains (UNICEF, 1999).

Intense Competition Jeopardizes Social Trust and Social Capital in the Community and Society

Social capital and trust are societal assets, essential to the maintenance of

community life and individual well-being – both public health concerns. To the extent that

destructive competition directly and indirectly threatens social capital it may reduce

32

economic growth and, ironically in the long run, even national competitiveness (Muntaner

& Lynch, 1999; Wilkinson, 1996).

Social capital is a synthesis of theoretical concepts from the fields of sociology and

economics. It is basically a synonym for social connections. It “refers to features of social

organizations such as networks, norms, and social trust that facilitate coordination and

cooperation for mutual benefit” (Putnam, 1995. p. 67; 2000). Reciprocity, trust, and mutual

aid are all part of social capital (Kawachi, 1999). It is a basic human resource consisting of

“obligations and expectations, information channels, and social norms” (Coleman, 1988,

pp. S95-105, S118).

The idea of interpersonal trust is central to social capital (Barber, 1988; Fukuyama,

1995; Kramer & Tyler, 1996; Seligman, 1997). Trust involves two dimensions: “Trusting

behavior is the willingness to risk beneficial or harmful consequences by making oneself

vulnerable to another person. Trustworthy behavior is the willingness to respond to another

person’s risk-taking in a way that ensures that the other person will experience beneficial

consequences” (Johnson & Johnson, 1994, p. 54). It “enhances individuals’ willingness to

engage in various forms of spontaneous sociability, but in complex and often unexpected

ways” (Kramer, 1999, p. 584). It is as important at the national and global levels as it is at

the organizational level (Rosenau, 2003).

Living in a trusting community has positive public health consequences. Social

capital, interpersonal trust, and social cohesion mediate between inequality and health

discussed above (Kawachi, Kennedy, Lochner, & Prothrow-Stith, 1997). They are

correlated with lower mortality rates (Kawachi, Kennedy, & Lochner, 1997) and reductions

in crime and delinquency (Sampson & Groves, 1989; Sampson, Raudenbush, & Earls,

33

1997). Social trust within a group or community is essential if that group or community is

to be productive and to attain its goals (Coleman, 1994). “Healthy, egalitarian countries

have - or had - a sense of social cohesion and public spiritedness. Social rather than market

values remained dominant in the public sphere of life” (Wilkinson, 1996).

Social bonds, trust, and social capital are less vulnerable in societies where there is

a sharp distinction between what is acceptable competition and what is unacceptable

competition. Fair, constructive, and appropriate competition does not result in a decline of

social capital and reduced trust, as would intense interpersonal or zero-sum competition

(Nye, 1997). Research on individuals indicates that “trust tends to be developed and

maintained in cooperative situations and it tends to be absent and destroyed in competitive

and individualistic situations” (Johnson & Johnson, 1994, p. 53). Experimental research

suggests that a “strategy of mutual problem solving and the tactics of persuasion, openness,

and mutual enhancement” associated with a cooperative orientation can create an

environment where constructive competition is possible (Deutsch, 1973, p. 365).

The fair exchange of goods does not jeopardize social capital; destructive

competition does so. When the business environment becomes so intensely competitive

that it requires an emphasis on strategies of power and the tactics of coercion, threat, and

deception, there is little place for trust. Studies show that emphasis on “winning and losing

and the self interest implied by that orientation” reduce trust (Cappella & Jamieson, 1997,

p. 84-85). Social capital suffers. Relationships are more hierarchical and dominance of one

over the other is the goal. This jeopardizes rather than reinforces social capital, with its

requirements for an environment of reciprocity, social support, mutual sharing, and

recognition of the needs of others.

34

Reductions in social capital and trust may be due, in part, to the exaggerated levels

of competitiveness in U.S. society. Social surveys document the increasing social isolation

and the reductions in a sense of civic commitment that accompany lower levels of social

capital in America today (Yankelovich, 1999). The role played by competitiveness is subtle

and indirect in its effects. For example, across the whole society the heightened

employment mobility required of workers in a highly competitive economy may lead to

weaker community ties. When on-the-job competition makes for less time at home, the

social capital accruing from participation in Parent-Teacher Associations, civic

organizations, and church-related activities is diminished (Putnam, 1995, 2000).

Naturally occurring experiments at the societal level provide evidence pertinent for

studying the relationship between competition, social capital and health. The breakup of

the Soviet Union constitutes one example of such an experiment (Bobak & Marmot, 1996).

Throughout Eastern Europe destructive forms of competition developed in the 1990s.

Social capital was jeopardized as an environment of alienation and powerlessness resulted

(Barer, Evans, Hertzman, & Johri, 1998). Civil society was on the verge of collapse as

crime increased. The transition from the Soviet-style bureaucratic state (with its low levels

of competition) to today’s high levels of market competition has resulted in decreased

social capital and increased social pathology, and substantial deterioration of population

health. (Notzon, Komarov, CT, JS, & EV, 1998; Tarkowska & Tarkowski, 1991). “After

1989, the twin ideologies of individualism and the free market gave those at the top license

to abandon those at the bottom” (Hertzman & Marmot, 1996, p. 214).

A naturally occurring experiment in the opposite direction, historical in nature, is

equally informative. Britain during World War II had almost no unemployment, and there

35

was a high sense of social cohesion. Cooperation played more of a role as market

competition gave way to rationing, price controls, and subsidies. Much the same situation

existed during World War I. During these periods, life expectancy increased twice as fast

as during other periods in the 20th Century (Wilkinson, 1996, pp. 113-116). This could be

due to many factors but the observed absence of destructive societal competition in these

historical situations might well be associated with increased social capital and improved

societal health status.

* * * * *

Excessively destructive forms of competition at the global level may translate into

less attention to global environmental problems. Such problems, including global warming

pay no attention to national boundaries. In addition competition of the wrong sort

undermines cooperation between countries to control diseases that result in multinational

epidemics. War, for example, is one sort of competition that discourages cross-national

attention to global health issues.

Those nations already producing to capacity will find their responsibilities

increased and their burdens enlarged until the situation of the lesser-developed countries

improves. In the long run, the world is a more dangerous and less healthy place unless steps

are taken to achieve these goals. Neither crime nor disease, for example, respects national

boundaries (Angier, 2001). The weakest member of the global society of nations

establishes, directly or indirectly, the security level with which all must live. Controlling

destructive competition may appear to be a form of altruism at first glance, but it is at the

same time extraordinarily self-interested (Yach & Bettcher, 1998).

36

An example illustration case. A package of public health and population-health

benefits costing 10 billion dollars a year from the first-world countries would save millions

of lives in the third-world countries (Sachs, 2000). If just $34.00 of each first-world

nation’s per person health care spending were redistributed to the world’s poorest

countries, eight million lives per year would be saved. Productivity of the recipient

countries would increase; in some cases benefits would be fivefold the cost (Sachs, 2001).

It would be best for all because each and every under-performing nation reduces the quality

of our international life. “Hungry, sick homeless, and illiterate people cannot contribute to

economic development and technological and industrial modernization” (Silk & Silk, 1996,

p. 172).

Conclusion: Policy for Appropriate and Effective Competition

Managing competition may be necessary if all individuals, groups, organizations,

or nations are to develop to full capacity in the long term and contribute to a health and

productive international environments. This is especially true if the goal is to maximize

the health of populations or improve productivity.

Six types of policies that encourage appropriate and constructive competition,

public health friendly form of competition, are proposed here as an alternative (Johnson &

Johnson, 1974; Johnson & Johnson, 1989). These policies are not entirely new, nor are they

necessarily more expensive than are their opposite. Neither are they obviously politically

partisan in one direction or the other. All can be employed to structure incentives for better

performance without individual failure, whether the “individual” be defined as a person, a

corporation, or a country. Constructive competition incorporates incentives that improve

37

individual performance, increase productivity, and enhance efficiency while at the same

time avoiding the objectionable aspects of destructive competition.

First, policy that encourages goal-oriented competition rather than interpersonal

competition is desirable and constructive. HMOs that offer incentives for reaching specific

practitioner goals are an example of such policy. All physicians and physician groups who

attain a specific goal as regards quality measures and patient satisfaction are awarded a 10

percent bonus by Blue Cross of California (Gellene, 2001).

Second, policies that encourage zero-sum, winner-take-all results should be

avoided. For example, if an incentive pool is set up with a fixed amount of money

distributed to employees at the end of the year on the basis of measured individual

productivity, then destructive competition is increased. What one employee gains, another

loses. If, however, a bonus of a specific amount or percentage of salary is offered to all

employees who attain a certain level of productivity, or degree of improvement, then

overall performance may increase while destructive competition between employees does

not.

Third, policy should discourage forms of competition that provoke levels of anxiety

so high that it interferes with performance. A lot is known about the relationship between

anxiety and stress levels and what is optimal for individual and society (Boswell, Olson-

Buchanan, & LePine, 2000). This was discussed in above. Communicating as much

information as possible about the competition-related situation in advance may, in some

situations, reduce anxiety for many people. Taking steps to enhance individual control in

competitive situations may also reduce anxiety. Permitting participant input and

involvement in establishing the context of competition may similarly reduce isolation and

38

anxiety. Private policies along these lines would include “trying forms of worker

cooperatives, elected directors, employee share ownership, or almost any other forms of

democratic decision-making” (Wilkinson, 1999b, p. 538). As mentioned above, such

innovations have been found to increase productivity in many different situations (Baker,

1999).

Fourth, policies to encourage constructive competition need to be structured so that

everyone has a fair chance of, if not winning, at least gaining something they value from

participating. Examples from the sports-world are discussed below. Such competition is

structured to offer an advantage to those who have not won in the recent past in order to

keep everyone trying. For example, limiting past winners from being considered for awards

for a certain period of time gives others a chance to win.

Fifth, policies for constructive and appropriate competition encourage rules that are

agreed upon in advance, that seem fair to all, that indicate appropriate behavior, and that

outline unacceptable activity. Gaming the rules as well as explicit cheating may be human

nature, but policy needs to discourage them if constructive competition is to be assured.

Sixth, policies are best if they organize the competitive encounter so that

individuals, organizations, and nations receive constant feedback and can tell how they are

doing, where they can improve, and where they are meeting expectations. Total quality

improvement techniques, for example, are based on these principles. In this situation each

individual competes with himself or herself, striving to develop new and useful skills,

sharpen performance, and boost productivity, all the while enhancing what has already

been accomplished.

39

Making Provision for Public Health Considerations

The purpose of competition is not to be fair in the sense of giving everyone, in all

circumstances, an equal chance. Competition works differently, advantaging some,

disadvantaging others, depending on the circumstances, the context, and the individual.

Some people are simply better at competition than others.

From a public health point of view it is important to construct a win-win workplace

and to assure that each individual labors in an optimal environment be that cooperative or

competitive. Assuring a cooperative work environment for those who perform best in this

situation, is not a recommendation to return to blanket welfare programs or unrealistic

unemployment benefits that set up the wrong incentives. It simply means that at least some

of those who fail at competing may be more productive in a cooperative work environment.

Performing better in a cooperative situation does not mean all cooperatively oriented

individuals will fail if they are forced to compete by the context, culture, and incentives

available. It simply recognizes that some people just do not do as well and will be less

productive in a competitive situation. Public health has yet to give adequate attention to

problems related to competition.

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