Survival of Formula One Drivers

Objectives To examine the determinants of the duration time of drivers in the Formula One (F1) competition, which is an industry with high physical capital investment and requires labor with very high human capital. Methods Since estimates may be biased when the whole F1 history, starting with the 1950 season, is considered, unlike prior studies in the literature, this article limits its data set to racing seasons from 1981 to 2017. In addition, since the failure times are correlated within the drivers with multiple spells, single-spell methods used in prior studies underestimate true standard errors and produce inflated test statistics. Hence, the most appropriate approach for the duration analysis of F1 drivers would be the survival analysis for recurrent events, which is employed in this study. Results Once a driver exits F1, he survives for a shorter period of time if he returns. In order to survive longer, a driver has to perform better than his teammate. Each year of age decreases the probability of exit while drivers can increase their duration time in F1 by switching teams. Completing a race does not make any difference to survival but finishing a race on the podium lowers the probability of exit. Conclusion Team owners and managers should be cautious when they consider hiring a driver who exited F1 before. A driver should be at least better than his teammate in order to survive in F1. Drivers can also increase their chances of survival substantially by changing teams.