Success in eSports: Does Country Matter?

Petr Parshakov

Marina Zavertiaeva

International Laboratory of Intangible-driven Economy

National Research University Higher School of Economics

Abstract

Competitive computer gaming, known as eSports, has become popular,

resulting in an increase in the number of gamers and prize earnings. Unlike

traditional sports, eSports does not depend on the physical abilities of

participants and participation costs are low. Our goal is to test whether country

differences exist in eSports. We examine the relation between a country’s

tradition of playing eSports, country characteristics, and performance in

eSports. Our data set consists of the top 500 gamer prizes awarded in eSports

tournaments for the period of 2004–2014. We use a regression analysis to test

the joint hypothesis of country effects significance. Despite the unique

features of eSports, we find evidence of country effects similar to traditional

sports. Our results show that country effects for top tournaments are stronger.

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INTRODUCTION

Computer and video games are becoming more and more popular. The

continuing development of the Internet and gaming software allows many

people to be involved in this industry. In the early 2000s, amateurs organized

most video games competitions, but these competitions are becoming

increasingly professionalized (Tassi 2012). According to some estimates,

roughly 71.5 million people watched competitive computer gaming (eSports)

tournaments in 2013 (Warr 2014).

The growing popularity of eSports has caused an increase in the number

of gamers and determines the profits for the industry. The variation of the

number of gamers between games and the winnings of gamers are high and

depends on the game (e.g., Counter-Strike, Dota 2, League of Legends,

StarCraft II). Despite this growing popularity, few studies have analyzed

country-level success in eSports. The literature analyzes the determinants of

country success in traditional sports (Kuper and Sterken 2011; Vagenas and

Vlachokyriakou 2012) for countries that are well-known for a particular sport,

such as football (soccer) in Brazil, hockey in Canada, and figure skating in

Russia. However, as yet, no studies test whether country-level effects exist in

eSports performance or, if so, identify the determinants of these effects.

Intuitively, country differences may not be present in eSports due to its unique

features. That is, unlike traditional sports, the cost of participation in eSports is

low, location and climate conditions are irrelevant, and players’ physical

abilities do not matter. However, because this industry is growing, it is

important to understand differences between traditional sports and eSports,

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whether country differences affect eSports’ development, and, if so, the

determinants of these differences.

Therefore, we test whether country differences exist in eSports. In the

first step of our analysis, we examine the relation between the country of a

gamer’s origin and his or her performance in eSports. We take into account the

tradition of playing eSports following Pfau (2006), Kuper and Sterken (2011),

and Vagenas and Vlachokyriakou (2012) who underline the importance of

country tradition in a particular sport approximated by the past performance

for the current results. In the next step, we deepen our analysis by examining

the reasons for differences in performances between countries. We use

country-level characteristics from Hofstede’s cultural dimensions, the World

Values Survey, and Global Competitiveness Report indicators.

This study contributes to the literature in several ways. First, it provides

a better understanding of the phenomenon of eSports and its differences from

traditional sport. Few studies exist on eSports, probably because the industry

is young and few researchers have yet to examine it. However, this attitude is

changing. For example, Adamus (2012) addresses the phenomenon of eSports,

and Jonasson and Thiborg (2010) discuss how eSports will develop and its

future impact on sports. Second, this study is the first research to examine the

determinants of country performance in eSports. Taking into consideration the

unique features of eSports, we compare our results with previous studies of

performance in traditional sports. Third, we contrast online and offline

tournaments from a performance point of view, showing differences that have

been overlooked by the previous literature.

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 The remainder of this paper proceeds as follows. In the next section we

review the literature on country-level differences in traditional sports. We then

underline the definition of eSports and its peculiarities. We pay particular

attention to the features that distinguish it from traditional sports that may

explain the absence of country-level differences in gamers’ performance. The

next section describes our method, sample, and variables. The following

section reports and discusses the results of the two-stage empirical testing. The

last section concludes and provides a number of implications from the

research.

LITERATURE REVIEW

Literature on country-level performance in traditional sports competition is

concentrated on the Olympic Games because international competitions

provide enough country-level variation. The other sports that provides

sufficient variation in competitors is football (soccer). However, the literature

that analyzes the differences between and sources of football performance is

based on previous research of success in the Olympic Games.

Studies of success in the Olympics reveal different indicators that affect

country-level performance. The factors that explain performance are economic

and climate conditions (Hoffmann, Ging, and Ramasamy 2002, Johnson and

Ali 2004, Roberts 2006, Condon, Golden, and Wasil 1999, Hoffmann, Ging,

and Ramasamy 2004, Andreff, Andreff, and Poupaux 2008, Forrest, Sanz, and

Tena 2010, Bernard and Busse 2004), culture (Hoffmann, Ging, and

Ramasamy 2002), political factors (Hoffmann, Ging, and Ramasamy 2002,

Johnson and Ali 2000, Bernard and Busse 2004), heath level (Tcha and

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Pershin 2003, Roberts 2006), social and demographic (Hoffmann, Ging, and

Ramasamy 2004), and size of the team (Vagenas and Vlachokyriakou, 2012).

The other important factor that affects performance is tradition. Pfau (2006)

analyzes the 2006 Torino Winter Games and uses past performance as a proxy

of tradition. Kuper and Sterken (2011) conclude that tradition and geography

are primary factors affecting the medal-winning process. Thus, the literature

shows that country effects exist in traditional sports and can be explained by

different factors including tradition and past performance.

eSports Definition

The term electronic Sports emerged in the late 1990s (Wagner, 2006). The

first video-game competition (Intergalactic Spacewar Olympics) was held on

October 19, 1972 at Stanford University with a prize of a one-year

subscription to the Rolling Stone magazine (Hiltscher and Scholz 2015, 9).

Today no common definition of eSports exists. Wagner (2006, p. 438) defines

eSports as “an area of sport activities in which people develop and train

mental or physical abilities in the use of information and communication

technologies.” Witkowski (2012) points out that many aspects of traditional

sports are computer-assisted or computer-mediated; therefore, such a

definition does not take into account the key features of eSports. Alternatively,

we follow Hamari and Sjöblom (2015, p. 5) who defines eSports as “a form of

sports where the primary aspects of the sport are facilitated by electronic

systems; the input of players and teams as well as the output of the eSports

system are mediated by human-computer interfaces.”

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 Very few studies are devoted to eSports, probably because it is still a

young industry. Wagner (2006) and Adamus (2012) analyze the concept of

eSports and offer some suggestions for further empirical research. Jonasson

and Thiborg (2010) try to understand how eSports will develop and its future

impact on both eSports and traditional sports. Seo (2013) analyzes eSports

from a marketing perspective and finds that companies can use eSports for

advertising and promotion purposes. Coates and Parshakov (2015) analyze the

prize structure of Sports tournaments and conclude that it follows Rosen's

(1986) tournament theory. Comparing traditional sports and eSports, Crawford

(2005) argues that digital gaming may increase people’s interest in traditional

sports. In general, the literature on eSports is very dispersed, with most papers

focusing on the definition of this phenomena and its future implications (Seo

2013; Seo and Jung 2014; Taylor and Witkowski 2010; Taylor 2012)

eSports has several important and as yet unexamined features. We

underline four characteristics that are most relevant for our research. First, the

investment costs in eSports are lower. Sports facilities for spectator gaming

are much cheaper than traditional team sports. Also, the investment in players

is lower, and players can participate in multiple games on a professional level.

Second, because eSports is quite young, no professional schools have been

established to train players. Third, two types of tournaments are held for most

games: offline (LAN) and online. Top tournaments are held offline. Finally,

the rewards and money won is mostly performance based.

All of these features are important to our analysis. The first two features

(cost of investment in location and players and lack of professional schools)

imply that traditions and country characteristics do not matter for eSports

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performance. Thus, we focus on the last two characteristics and analyze online

and offline tournaments separately and suppose that the prize money won is

proxy for a gamer’s abilities and success.

METHODOLOGY

To test whether tradition and country characteristics matters for the eSports

performance, we use the following model:

log(total_prizeit )   βi  gamer_dummyi + β j  country_dummy j +

i j

β
k
k  year_dummyk + βh  game_dummyh  ε ft
h

(1)

where total_prize is a sum of money won each year; gamer_dummy is a vector

of dummy variable for each gamer to control for individual skill; year_dummy

controls for time effects; game_dummy controls for each game and country

dummy reflects country effect. We also estimate regressions with offline and

online prizes as the dependent variable to determine whether differences exist

between top (offline) and ordinary (online) tournaments. We take the log of

prize because the distribution of the prizes is highly positively skewed.

To investigate how socio-cultural country characteristics influence

success in eSports, we use a two-step procedure. In the first step, we estimate

the regression model (Eq. 1). Next, we interpret the country dummy variable

coefficients in this equation as an indicator of the country of origin’s

contribution to success in terms of money. Thus, in the second step, we

consider the determinants of the country effects. In this second step, variation

occurs only across countries, which leads to a small number of observations.

Therefore, we use a correlation analysis rather than a regression. Country

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characteristics consist of the indicators of population and GDP (which are both

significant for the performance in traditional sports); indicators of beliefs,

values, and motivations from World Values Survey; some indicators from the

Global Competitiveness Report (2014–2015); and Hofstede’s cultural

dimensions.

DATA

To determine the effect of socio-cultural characteristics on players’ success in

eSports, we use the data on prizes that players win in tournaments. We obtain

this information from the results of the project ESports Earnings.1 This

resource is based on freely available public information on different

tournaments in eSports, the nicknames of winners, and the sums won. ESports

Earnings’ website contains information on each gamer’s prize earnings (in

dollars) for the period from 1999 to 2014. Thus, the collected data have an

unbalanced panel structure. We use the data only for the period from 2004 to

2014 due to the availability of socio-cultural characteristics. Nominal prizes

are corrected to the inflation rate.

Table 1 contains the descriptive statistics on the income of the top 500

gamers. We report the data on total prize winnings and also distinguish

between online and offline prize winnings. The data indicate that the

distribution of prizes has a long right tail: The difference between the third

quantile and the maximum is huge. That is, several players win big prizes. The

median value of online prize winnings is zero, suggesting that a large number

of the analyzed players receive their income primarily from offline

1
ESports Earnings’ official website is http://esportsearnings.com/.

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tournaments. The difference between the mean (and also median) values of

online and offline prize shows that, on average, players receive more income

from offline tournaments than from online tournaments. Specifically, 78% of

total prize money is earned from offline tournaments.

Table 1. Summary on top 500 gamer’s income

Minimu 1st Median Mean 3rd Maximum
m quantile quantile
Total prize 0 146.9 549.2 7153 2262 2 265 000
Online prize 0 0 0 1208 71.11 2 155 000
Offline prize 0 53.37 450.6 5946 2000 2 265 000

Table 2 reports the 10 countries with the highest total income of gamers.

The leaders cannot be easily defined by obvious country-specific factors such

as GDP per capita or the development of hi-tech industries. Thus, we must

analyze more specific country characteristics. Table 3 show that the highest

gamer incomes by games are Counter-Strike, Dota 2, and League of Legends.

Interestingly, prizes in the new version of Counter-Strike, Global Offensive,

are less than the in the classic version. We believe that strong game effects

should exist. Thus, we need to control for this effect during the empirical

estimations.

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 Table 2. Top-10 countries by total income, $
Country Total prize
United States 28 288 105.95
Brazil 25 836 479.60
Sweden 14 961 649.28
Korea 13 151 197.21
China 8 088 451.01
Germany 7 045 541.06
Russian Federation 6 027 394.15
Denmark 5 508 162.92
Poland 4 420 448.60
France 4 240 071.18

Table 3. Top-10 games by total income

Game Total prize
Counter-Strike 45 306 509.19
Dota 2 20 327 548.46
League of Legends 13 622 356.24
StarCraft II 9 983 049.67
Super Smash Bros. Brawl 5 523 687.50
Counter-Strike: Global Offensive 5 460 345.21
Street Fighter X Tekken 5 271 438.50
StarCraft: Brood War 4 267 150.15
CrossFire 4 183 856.89
Defense of the Ancients (WC3) 4 031 463.87

We use three sources of information for countries’ characteristics:

Hofstede’s cultural dimensions, the World Values Survey, and the Global

Competitiveness Report. Professor Geert Hofstede and his research team

identify and develop six dimensions of national culture. The website2 used in

the current research to gather data contains the information about five metrics

of cultural dimensions estimated for different countries. The following

dimensions are evaluated in the form of indexes with the minimum value of 1

and maximum value of 120.

2
http://www.clearlycultural.com/geert-hofstede-cultural-dimensions

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 Individualism (individualism). Individualistic countries are

characterized by the poor ties between individuals. According to

the Hofstede Center, people in such countries “stress on personal

achievements and individual rights [and] expect from each other

to fulfil their own needs.” We posit that people who are not

involved in group relationships are more likely play games and

therefore have more time to spend on games and play them

successfully.

 Uncertainty avoidance (uncert_avoid). This metric indicates “to

what extent a culture programs its members to feel either

uncomfortable or comfortable in unstructured situations.”

Uncertainty avoidance can influence eSports incomes both

positively or negatively. On the one hand, people can escape the

uncertainty of real life by playing computer games, which are

more familiar, structured, and have understandable rules. On the

other hand, computer games can also be connected with

uncertainty as gamers face many unexpected situations during

tournaments. In the majority of games, to earn high prize money

gamers must be ready to react immediately to unexpected

situations.

 Long-term orientation (lr_orient). According to the Hofstede

Center, nations with a short-term orientation “prefer to maintain

time-honored traditions and norms while viewing societal change

with suspicion.” Conversely, long-term-oriented nations are

more persistent and encourage thrift and education as the ways to

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 prepare for the future. We posit that to participate successfully in

tournaments and earn high prize money, gamers must be long-

term oriented.

 Masculinity (masculinity). Masculinity—versus its opposite,

femininity—refers to the distribution of roles between the

genders. Role division based on gender is another fundamental

issue that societies approach in a range ways.

 Power Distance Index (power_dist). Power distance measures

the extent to which the less powerful members of organizations

and institutions (such as the family) accept and expect that power

is distributed unequally.

The World Values Survey3 was started in 1981 to apply research

methodology to estimate values and beliefs of people all over the world. Using

a common questionnaire, the World Value Survey conducts its survey in

almost 100 countries, covering nearly 90 percent of the world’s population.

The report contains a wide variety of data. We focus on the following metrics:

 Very important in life: Family (very_family). This metric measures

the percentage of respondents for which family is very important.

We posit that in counties in which family rates as highly important,

people usually are less involved in electronic games.

 Very important in life: Friends (very_friends). This metric

measures the percentage of respondents that regard friends as a

very important part of their life. On the one hand, in countries with

3
http://www.worldvaluessurvey.org/WVSContents.jsp

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 closer friendships, people may spend less time on games. On the

other hand, friends can be a reason to play together.

 Very important in life: Leisure time (very_leisure). This variable

reflects the percentage of respondents for whom leisure time is

very important. These people are probably not willing to spend all

their time playing games.

 Very important in life: Work (very_work). The majority of people

do not regard playing games professionally as a job. Therefore, if a

person lives in the country where the work is considered very

important, he or she likely will face higher barriers to participate in

eSports events.

 Very important in life: Religion (very_religion). Similar to the

importance of work, nations that place emphasis on religion usually

do not approve of electronic games. They are often connected with

murders and the underworld.

 Feeling of happiness: not happy at all (not_happy). We use the

percentage of people that feel unhappy (not happy at all). We posit

that those who feel unhappy can escape to the alternate reality of

gaming.

 Hard work (hard_work). This variable is the percentage of the

population that thinks that hard work is an important child quality.

 Tolerance to different religion (not_diff_religion). This metric

reflects the percentage of people who responded that they do not

like having people of a different religion as neighbors.

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 State of health (subjective): very good (very_good_health). We use

the percentage of the population that feel they are in a very good

state of health. Our intuition is that the state of health and time

spent on electronic games are connected negatively.

 Active/Inactive membership: Sport or recreational organization:

active member (sport_members). Similar to the previous variable,

we posit that membership in sports or recreational organization is

negatively connected with success in eSports.

 Important child qualities: Imagination (imagination). The

respondents are asked to choose the most important qualities that

children can be encouraged to learn at home. The value of the

variable is the percentage of people that mention imagination as

important. We argue that imagination is important for success in

eSports.

 Secure in neighborhood (secure). This metric is the percentage of

people who feel secure in their local neighborhood.

 Would not like to have as neighbors: People of a different race

(not_diff_race). We believe that highly tolerant people will be

more successfully in offline tournaments, where it is very

important to cooperate with others.

 Willingness to make my parents proud (make_parents_proud). We

use the percentage of population that responded that making their

parents proud is important for them.

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  Being world citizen (world_citizen). People have different views

about themselves and how they relate to the world. We use the

percentage of population that see themselves as world citizens.

 Satisfaction with your life (satisfact_life). The respondents choose

a number on a scale from 1 (completely dissatisfied) to 10

(completely satisfied) that characterizes their satisfaction. We use

the weighted value: the percentage of respondents is multiplied by

the grade. In more satisfied societies, people rarely escape from the

real life to electronic games.

 Willingness to fight for your country (fight_for_my_country). We

evaluate the percentage of people that are ready to fight for their

country. Such people may also be ready to fight in certain games

such as Counterstrike.

The Global Competitiveness Report4 was created by specialists of

World Economic Forum to measure drivers of competitiveness and compare

countries by the level of their performance. We use this report to control for

the Internet bandwidth (inet_speed) in the particular country. Higher speed is

likely connected with the higher popularity of eSports and allows players to

train more efficiently. The bandwidth is measured in kb/s per user. We also

use the indicators life expectancy (life_expect), labor market efficiency

(labor_m_eff), quality of health and education, (health_and_edu), and

availability of latest technology.

Table 4 reports the descriptive statistics of the independent variables.

The majority of the variables do not have outliers. Only Internet bandwidth

4
http://www.weforum.org/

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(inet_speed) has long right tail. The median value of very_family is 91, which

suggests that for the vast majority of people in the sample countries family is

still very important. Friends, on average, are two times less important than

family. Work is regarded as very important 1.5 times more often than leisure

time. Approximately 60% of people are ready to fight for their country.

Table 4. Descriptive statistics of independent variables

Statistic N Mean St. Dev. Min Max
power_dist 41 60.000 22.000 11 100
individualism 41 49.000 24.000 17 91
masculinity 41 49.000 22.000 5 100
uncert_avoid 41 66.000 25.000 8 100
lr_orient 41 55.000 22.000 20 100
GDP 41 28,762.000 22,026.000 1,902 100,318
life_expect 41 78.000 3.900 69.000 84.000
health_and_edu 41 6.200 0.360 5.400 6.900
labor_m_eff 41 4.400 0.580 3.000 5.700
latest_tech 41 5.400 0.840 3.800 6.600
inet_speed 41 157.000 281.000 4.200 1,763.000
population 40 82.000 216.000 3.000 1,361.000
very_family 24 90.000 4.800 78 99
very_friends 24 45.000 10.000 22 68
very_leisure 24 36.000 9.500 12 59
very_work 24 54.000 17.000 30 91
very_religion 24 33.000 25.000 3 86
not_happy 24 1.500 1.100 0 4
very_good_health 24 21.000 8.900 5 38
hard_work 24 57.000 22.000 14 88
imagination 24 25.000 13.000 12 69
sport_members 24 14.000 11.000 2 40
not_diff_race 24 16.000 11.000 1 40
not_diff_religion 24 14.000 11.000 3 37
satisfact_life 24 7.000 0.610 5.800 8.500
make_parents_proud 24 32.000 18.000 5 69
fight_for_my_country 24 59.000 18.000 15 82
world_citizen 24 25.000 12.000 9 54
secure 24 30.000 14.000 6 59

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Empirical Results

Table 5 reports results of the regression analysis. All models include the

control variables: game dummies, year dummies, and each gamer’s dummy to

control for individual skills.5 All models are significant according to the F-test

with a quite high R2, probably due to the inclusion of gamer’s dummies. We

first look at our model for total prize. Next we concentrate on the differences

between offline and online tournaments to understand whether differences

exist between top and low tournaments.

Table 5. Estimation results: determinants of total, online and offline prize

Dependent variable:
Log (total_prize) Log(offline_prize) Log(online_prize)
country Belgium -2.370** -4.336*** 3.967
(1.051) (1.041) (2.991)
country Brazil -1.199 -2.122***
(0.793) (0.809)
country Canada -2.031*** -2.433*** 0.225
(0.652) (0.709) (1.886)
country China -1.220** -1.935*** 1.289
(0.615) (0.638) (1.690)
country Czech Republic -1.966** -1.485 -0.441
(0.919) (1.076) (2.275)
country Denmark -2.602*** -2.386*** 1.051
(0.703) (0.761) (2.287)
country France -0.779 -1.619** 1.339
(0.726) (0.762) (1.844)
country Germany -0.687 -1.238* 0.432
(0.663) (0.701) (1.684)
country Japan 0.602 -0.109 4.485*
(1.906) (1.784) (2.663)
country Korea, Republic of -1.434** -1.805*** -0.168
(0.568) (0.593) (1.343)
country Malaysia -1.136 -1.871** 8.805***
(0.845) (0.841) (2.887)
country Netherlands -1.758* -2.813* 1.613
(0.965) (1.442) (2.131)
country Norway -0.190 -0.994
(0.903) (0.937)
country Philippines -2.392*** -3.530*** 0.884

5
We do not report results for the gamers dummy in the Table 5; the results are available upon
request.

Electronic copy available at: https://ssrn.com/abstract=2662343

 (0.708) (0.713) (2.726)
country Poland 0.552 -0.668
(0.874) (0.900)
country Russian Federation -1.896*** -2.126*** -2.663
(0.662) (0.680) (2.155)
country Singapore -0.067 -0.318 8.109***
(0.856) (0.935) (2.887)
country Spain -2.370** -2.614** -3.409
(1.010) (1.162) (2.474)
country Sweden -1.375** -1.035 3.520
(0.676) (0.724) (2.640)
country Taiwan, Province Of
0.009 -0.328
China
(0.889) (0.890)
country Ukraine -1.200 -1.463* -1.080
(0.756) (0.790) (1.780)
country United Kingdom -0.829 -1.544* 0.329
(0.779) (0.812) (1.767)
country United States -1.600*** -2.376***
(0.598) (0.629)
country Viet Nam -2.646*** -3.369*** 0.732
(0.793) (0.822) (2.383)
time2006 -0.186* -0.180* -0.219
(0.106) (0.108) (0.171)
time2007 -0.355*** -0.279** -0.416**
(0.116) (0.120) (0.181)
time2008 0.234* 0.248* -0.039
(0.121) (0.127) (0.186)
time2011 0.535*** 0.628*** 0.172
(0.127) (0.133) (0.206)
time2012 -0.555*** -0.474*** -0.897***
(0.129) (0.135) (0.210)
time2013 -0.512*** -0.397*** -0.842***
(0.135) (0.141) (0.221)
time2014 0.031 0.113 -0.357
(0.136) (0.141) (0.222)
game Counter-Strike 0.083 0.150 -0.972
(0.512) (0.562) (1.509)
game Counter-Strike: Global
-0.062 0.059 -1.543
Offensive
(0.509) (0.558) (1.550)
game Counter-Strike: Source -0.317 0.428 -2.026
(0.519) (0.572) (1.556)
game CrossFire 2.438*** 2.466*** -1.974
(0.667) (0.732) (2.155)
game Defense of the Ancients
0.932* 0.770 -2.794
(WC3)
(0.531) (0.554) (1.747)
game Dota 2 0.645 0.796 -3.593**
(0.517) (0.544) (1.745)
game Halo 2 1.271** 1.160** 1.454
(0.537) (0.568) (2.941)

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 game Halo 3 -1.523*** -0.799 2.463
(0.559) (0.640) (2.461)
game Hearthstone: Heroes of
0.774 1.680** 2.024
WarCraft
(0.591) (0.663) (1.731)
game League of Legends -0.084 0.102 -2.094
(0.497) (0.530) (1.627)
game Point Blank 0.854 1.260 0.641
(0.799) (0.938) (2.089)
game Quake Live -1.736 -2.100** -7.121*
(1.073) (1.038) (3.899)
game StarCraft II 0.339 0.289 -2.275
(0.512) (0.548) (1.725)
game StarCraft: Brood War 0.945* 0.751 -1.047
(0.536) (0.574) (1.737)
game Super Smash Bros. Melee -0.093 -0.169
(0.786) (0.784)
game Super Street Fighter IV
-0.843 -1.636* -2.287
Arcade Edition
(0.879) (0.942) (2.354)
game Team Fortress 2 -0.572 -1.402 -4.254*
(0.862) (0.878) (2.438)
Game r's dummy included included included
Constant 11.722*** 12.203*** 9.050***
(1.656) (1.566) (2.597)
Observations 12,665 10,436 3,808
R2 0.763 0.798 0.850
Adjusted R2 0.426 0.477 0.503
Residual Std. Error 1.430 (df = 5224) 1.296 (df = 4023) 1.130 (df = 1146)
2.265*** (df = 7440; 2.483*** (df = 6412; 2.445*** (df =
F Statistic
5224) 4023) 2661; 1146)
* ** ***
Note: p<0.1; p<0.05; p<0.01

Five games (29%) have significant effects for the total prize model.

Most of the top games’ dummies are not significant, probably due to the

inclusion of the gamer’s dummy. Most of the year dummies are significant.

Interestingly, the 2008 dummy is positive despite the financial crisis.

Significant dummies occur for the country effects. Because we use the log of

the prize as a dependent variable, the coefficients reflect the percentage. The

smallest coefficient is the Vietnam dummy variable. In other words, Vietnam

gamers earn about 2.6 less than the baseline category. Conversely, Japanese

Electronic copy available at: https://ssrn.com/abstract=2662343

gamers earn 60% above the average. Due to many gamers’ dummies and

omitted categories for gamers, games, years, and countries, the results are best

interpreted relative to the differences for different countries, not the sign of the

coefficient.

Despite the results for Vietnam and Japan, many countries do not have

significant effects. For that reason, we use a joint hypothesis test to answer our

research question. Table 6 shows the results. We provide the results for the

joint test of all counties coefficient significance as well as for different parts of

the world. We test European countries, Asian countries, and the Americas

(New World) separately to understand whether certain regions are better in

eSports. According to the joint hypothesis test results, the countries effects are

significant for the all countries and for each part of the world. That is, certain

countries have significantly higher performance in eSports despite the sport’s

short history, low cost of participation, and the fact that, unlike traditional

sports, environmental conditions (i.e., climate) do not affect gamers’

performance.

Electronic copy available at: https://ssrn.com/abstract=2662343

 Table 6. Joint hypothesis testing results
Hypothesis F Pr(> F)

All countries, total prize 2.600 0.00004

All countries, offline prize 3.000 0.00000
All countries, online prize 1.700 0.028
European countries, total prize 2.800 0.0004
European countries, offline prize 2.400 0.003
European countries, online prize 1.200 0.320
Asian countries, total prize 3.400 0.001
Asian countries, offline prize 5.400 0.00000
Asian countries, online prize 2.300 0.024
Americas countries, total prize 3.400 0.016
Americas countries, offline prize 4.900 0.002
Americas countries, online prize 0.019 0.980

Note: The first row denotes the hypothesis. “All countries” mean that we
are testing joint hypothesis that coefficients for all countries in our sample are
equal to zero, “total prize” means that we are testing hypothesis for the
regression equation with log of total prize as dependent variable.

A comparison of the results for the offline (top) and online (low)

tournaments provides interesting findings. The results for the year and game

dummies looks similar, but some countries present opposite results. For

example, the Malaysia coefficient for the offline (online) tournaments is

negative (positive). According to joint hypothesis test (Table 6), both offline

and online tournaments have significant countries effects. Still, European and

the Americas do not have significant effects for online tournaments. Thus,

country effects for top tournaments are stronger, a finding that is similar to

traditional sports: The higher the level of the competition is, the more

important the history and traditions of training in a particular sport are.

Electronic copy available at: https://ssrn.com/abstract=2662343

 In the next step of our analysis, we investigate the determinants of the

better performance of some countries in eSports. For this purpose, we use the

coefficients of the country dummies from Table 5 as an indicator of country

performance and estimate the correlation with different country-level

characteristics as previously described.

Table 7 contains the results for the correlation analysis. Here we do not

divide tournaments into offline and online and report the results for the total

prize. Because the number of observation is low and the unit of observation is

the country, we interpret the results to the 15% significance level.

Interestingly, common predictors of country performance such as GDP and

population are not significant.

Table 7. 2nd step correlation results

Indicator Coefficient P-value Indicator Coefficient P-value

power_dist -0.130 0.650 very_religion -0.130 0.650
individualism -0.180 0.530 not_happy -0.086 0.770
masculinity 0.440 0.120 very_good_health 0.180 0.540
uncert_avoid 0.120 0.690 very_work -0.099 0.740
lr_orient 0.410 0.140 hard_work -0.490 0.072
GDP 0.130 0.650 imagination 0.059 0.840
life_expect 0.400 0.160 sport_members 0.042 0.890
health_and_edu 0.530 0.052 not_diff_race 0.057 0.850
labor_m_eff 0.250 0.400 not_diff_religion 0.340 0.240
latest_tech 0.070 0.810 satisfact_life -0.092 0.750
inet_speed 0.130 0.670 make_parents_proud -0.340 0.230
population -0.100 0.730 fight_for_my_country -0.038 0.900
very_family -0.007 0.980 world_citizen -0.460 0.098
very_friends 0.015 0.960 secure 0.070 0.810
very_leisure 0.210 0.470 GDP per capita 0.180 0.530

Electronic copy available at: https://ssrn.com/abstract=2662343

 Table 7 shows that masculinity, long-run orientation, and the level of

health and education are positively significant indicators. This finding means

that successful gamers live in the counties in which high quality education and

health care are available. In these countries the distribution of roles between

the genders is biased toward masculinity, which may explain the

overwhelming majority of men among gamers. Long-term orientation is also

important for being successful in eSports. Conversely, the indicators of

hard_work and world_citizen are negatively significant. Thus, whether gamers

live in a country in which the majority of people think themselves as world

citizens is unimportant. The same is true for the importance of hard work.

Conclusion

This study provides evidence of country differences in eSports. This finding is

similar to the results of studies of performance in traditional sports (Johnson

and Ali 2004; Roberts 2006; Forrest, Sanz, and Tena 2010). In line with Kuper

and Sterken (2011) for traditional sports, we find that tradition affects

performance in eSports. Our results also show that county effects for top

tournaments are stronger than for low tournaments, which is also similar to the

traditional sports.

On the one hand, similar to Hoffmann, Ging, and Ramasamy (2004), we

find that social and demographic variables are significant. On the other hand,

we find no evidence of the importance of economic factors, which is well-

established for traditional sports (Andreff, Andreff, and Poupaux 2008,

Bernard and Busse 2004). We also find that some games show significant

effects on the money won. The list of games with the highest income is not the

Electronic copy available at: https://ssrn.com/abstract=2662343

same as the list of game effects: The games with the highest effects are

Defense of the Ancients (WC3), CrossFire, and Counter-Strike, and games

with the highest incomes are Counter-Strike, Dota 2, and League of Legends.

The results of this study are useful for game producers to promote their

games. Understanding target audience is vitally important for proper and

effective game promotion. In addition, our results show that in some countries

gamers are making money from eSports tournaments, which may be important

for government taxation rules for this industry.

Our findings are subject to at least three limitations. First, no data exist

on the individual characteristics of gamers. Second, we study only the top 500

gamers each year, and the results may be different for less successful gamers.

Third, we lack data on each gamer’s experience and their team, which may be

important for some games.

Electronic copy available at: https://ssrn.com/abstract=2662343

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