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The optimal disclosure policy in contests with stochastic entry: A Bayesian persuasion perspective

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  • Feng, Xin
  • Lu, Jingfeng

Abstract

Following a Bayesian persuasion approach, we establish that full disclosure (resp. concealment) is the contest organizer’s effort-maximizing policy for disclosing the number of actual contestants if the characteristic function of the imperfectly discriminatory contest technology is strictly concave (resp. convex).

Suggested Citation

  • Feng, Xin & Lu, Jingfeng, 2016. "The optimal disclosure policy in contests with stochastic entry: A Bayesian persuasion perspective," Economics Letters, Elsevier, vol. 147(C), pages 103-107.
    • Handle: RePEc:eee:ecolet:v:147:y:2016:i:c:p:103-107
    DOI: 10.1016/j.econlet.2016.08.038
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    References listed on IDEAS

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    1. Emir Kamenica & Matthew Gentzkow, 2011. "Bayesian Persuasion," American Economic Review, American Economic Association, vol. 101(6), pages 2590-2615, October.
    2. Qiang Fu & Qian Jiao & Jingfeng Lu, 2011. "On disclosure policy in contests with stochastic entry," Public Choice, Springer, vol. 148(3), pages 419-434, September.
    3. Jeffrey Ely & Alexander Frankel & Emir Kamenica, 2015. "Suspense and Surprise," Journal of Political Economy, University of Chicago Press, vol. 123(1), pages 215-260.
    4. McAfee, R. Preston & McMillan, John, 1987. "Auctions with a stochastic number of bidders," Journal of Economic Theory, Elsevier, vol. 43(1), pages 1-19, October.
    5. Lim, Wooyoung & Matros, Alexander, 2009. "Contests with a stochastic number of players," Games and Economic Behavior, Elsevier, vol. 67(2), pages 584-597, November.
    6. Yun Wang, 2015. "Bayesian Persuasion with Multiple Receivers," Working Papers 2015-03-24, Wang Yanan Institute for Studies in Economics (WISE), Xiamen University.
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    Citations

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    Cited by:

    1. Gerardi, Dino & Grillo, Edoardo & Monzón, Ignacio, 2022. "The perils of friendly oversight," Journal of Economic Theory, Elsevier, vol. 204(C).
    2. Clark, Derek J. & Kundu, Tapas, 2021. "Competitive balance: Information disclosure and discrimination in an asymmetric contest," Journal of Economic Behavior & Organization, Elsevier, vol. 184(C), pages 178-198.
    3. Wang, Zhewei & Zhou, Lixue, 2022. "Information disclosure in sequential (and simultaneous) contests," Economics Letters, Elsevier, vol. 212(C).
    4. Chen, Bo, 2020. "Disclosure policies in research contests with stochastic entry," Economics Letters, Elsevier, vol. 191(C).
    5. Chen, Zhuoqiong, 2021. "Optimal information exchange in contests," Journal of Mathematical Economics, Elsevier, vol. 96(C).
    6. Anastasia Antsygina & Mariya Teteryatnikova, 2023. "Optimal information disclosure in contests with stochastic prize valuations," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 75(3), pages 743-780, April.
    7. Christian Ewerhart & Julia Lareida, 2018. "Voluntary disclosure in asymmetric contests," ECON - Working Papers 279, Department of Economics - University of Zurich, revised Jul 2023.
    8. Jiao, Qian & Ke, Changxia & Liu, Yang, 2022. "When to disclose the number of contestants: Theory and experimental evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 193(C), pages 146-160.
    9. Luke Boosey & Philip Brookins & Dmitry Ryvkin, 2020. "Information Disclosure in Contests with Endogenous Entry: An Experiment," Management Science, INFORMS, vol. 66(11), pages 5128-5150, November.
    10. Wei-Torng Juang & Guang-Zhen Sun & Kuo-Chih Yuan, 2020. "A model of parallel contests," International Journal of Game Theory, Springer;Game Theory Society, vol. 49(2), pages 651-672, June.
    11. Bo Chen & Marco Serena, 2020. "Bid Caps and Disclosure Policies," Working Papers tax-mpg-rps-2020-08, Max Planck Institute for Tax Law and Public Finance.
    12. Chen, Bo & Ma, Lijun & Zhu, Zhaobo & Zhou, Yu, 2020. "Disclosure policies in all-pay auctions with bid caps and stochastic entry," Economics Letters, Elsevier, vol. 186(C).
    13. Andriy Zapechelnyuk, 2020. "Optimal Quality Certification," American Economic Review: Insights, American Economic Association, vol. 2(2), pages 161-176, June.
    14. Xiangyu Wang & Shulin Liu, 2023. "Disclosure policies in all‐pay auctions with bid caps and stochastic entry: The impact of risk aversion," Bulletin of Economic Research, Wiley Blackwell, vol. 75(4), pages 1181-1190, October.
    15. Raphaela Hennigs, 2019. "Conflict Prevention by Bayesian Persuasion," Working Papers tax-mpg-rps-2019-16_1, Max Planck Institute for Tax Law and Public Finance.
    16. Chen, Bo & Serena, Marco, 2023. "Disclosure Policies in All-Pay Auctions with Bid Caps," Journal of Economic Behavior & Organization, Elsevier, vol. 209(C), pages 141-160.
    17. Bo Chen & Emilios Galariotis & Lijun Ma & Zijia Wang & Zhaobo Zhu, 2023. "On disclosure of participation in innovation contests: a dominance result," Annals of Operations Research, Springer, vol. 328(2), pages 1615-1629, September.

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    More about this item

    Keywords

    Bayesian persuasion; Contests; Information disclosure; Stochastic entry;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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