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Keep on fighting: The dynamics of head starts in all-pay auctions

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  • Clark, Derek J.
  • Nilssen, Tore

Abstract

We investigate a model of a series of contests in which a contestant's past and present success gives a head start over a rival in the future. How this advantage from winning affects contestants' efforts, whether the laggard gives up or keeps on fighting, and how the head start develops over time, are key issues. We find that the expected effort of the laggard will always be higher than the rival at some stage in the series of contests, and this is most likely to happen when at a large disadvantage or at a late stage in the series.

Suggested Citation

  • Clark, Derek J. & Nilssen, Tore, 2018. "Keep on fighting: The dynamics of head starts in all-pay auctions," Games and Economic Behavior, Elsevier, vol. 110(C), pages 258-272.
    • Handle: RePEc:eee:gamebe:v:110:y:2018:i:c:p:258-272
    DOI: 10.1016/j.geb.2018.05.005
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    Citations

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    Cited by:

    1. Derek J. Clark & Tore Nilssen, 2021. "Competitive balance when winning breeds winners," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 56(2), pages 363-384, February.
    2. Na Wang & Shuangying Chen & Lei Xiao & Feng Fu, 2021. "The Sustainability of Superior Performance of Platform Complementor: Evidence from the Effects of Iterative Innovation and Visibility of App in iOS Platform in China," Sustainability, MDPI, vol. 13(7), pages 1-16, April.
    3. Malin Arve & Olga Chiappinelli, 2021. "The Role of Budget Constraints in Sequential Elimination Tournaments," Scandinavian Journal of Economics, Wiley Blackwell, vol. 123(4), pages 1059-1087, October.
    4. Clark, Derek J. & Nilssen, Tore, 2018. "Beating the Matthew Effect: Head Starts and Catching Up in a Dynamic All-Pay Auction," Memorandum 2/2018, Oslo University, Department of Economics.
    5. Subhasish M. Chowdhury & Patricia Esteve‐González & Anwesha Mukherjee, 2023. "Heterogeneity, leveling the playing field, and affirmative action in contests," Southern Economic Journal, John Wiley & Sons, vol. 89(3), pages 924-974, January.
    6. Bhattacharya, Puja & Rampal, Jeevant, 2019. "Contests within and between groups," Discussion Papers, Research Unit: Market Behavior SP II 2019-206, WZB Berlin Social Science Center.
    7. Arne Lauber & Christoph March & Marco Sahm, 2022. "Optimal and Fair Prizing in Sequential Round-Robin Tournaments: Experimental Evidence," CESifo Working Paper Series 9651, CESifo.
    8. Clark, Derek J. & Nilssen, Tore, 2020. "Creating balance in dynamic competitions," International Journal of Industrial Organization, Elsevier, vol. 69(C).

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    More about this item

    Keywords

    Contest; All-pay auction; Win advantage; Head start;
    All these keywords.

    JEL classification:

    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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