Interesting research – but count me a skeptic of those who seek to draw overly broad conclusions from it:

The same phenomenon seems to also affect students taking the SAT. In a paper released last year, researchers from the University of Michigan and the University of Haifa compared average SAT scores with the average number of students in test-taking venues in all 50 states, and found that students who took the SAT in larger groups did worse. They concluded that the mere knowledge of their competitors—the sight of all of those other students scratching in their answers in the same room—decreased motivation.

Ms. Brown argues that, unless firms with internal competitions take the superstar effect into account, they might actually end up with the worst possible outcome: Employees who are both unhappy and unmotivated. Sometimes, hiring the best job candidate might not be the best idea.

A little competition can be productive, of course. The relationship between rivals can take curious forms—Ernest Hemingway and F. Scott Fitzgerald were enemies as much as they were friends, but each helped the other's writing. "Rivalry adds so much to the charms of one's conquests," Louisa May Alcott has said.

…And it's not just physical performers who are vulnerable to choking during competition. When students are placed in a high-pressure competition solving difficult math problems—Ms. Beilock offers them cash rewards for winning—they perform significantly worse than students who are told to simply try their best. (The effect is especially pronounced among top performers.) According to Ms. Beilock, the anxiety triggered by the tournament eats up precious mental resources, thus making it harder to come up with the answer. We try harder and do worse.

In the early 1960s, the psychologist Sam Glucksberg demonstrated that the same effect could also inhibit creativity. He gave subjects a standard test of creativity known as the Duncker candle problem. The "high drive" group was told that the person solving the task in the shortest amount of time would receive $20. The "low drive" group, in contrast, was reassured that their speed didn't matter. Here's where the results get weird: The subjects with an incentive to think quickly took, on average, more than three minutes longer to find the answer. Experiments like this have led Ms. Beilock to conclude that people should be skeptical of evaluations based on a single high-stakes performance.

Competing against a superstar could make people even more likely to choke. "Anything that makes us more aware of superior performance will also make us more aware of our own performance, which can be a bad thing," Ms. Beilock says. "That's why it's always best to sit at the front of the class when taking a hard test. You don't want to start comparing yourself to anybody else."

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