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Is there free riding in group contests?

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  • Aner Sela

    (Ben-Gurion University of the Negev)

Abstract

We study best-of-two contests between two symmetric groups of players. Each group includes n heterogeneous players who have resource budgets that decrease in the second stage proportionally to the resource allocated in the first stage. We demonstrate that in our group contests complete “free riding” does not necessarily exist, namely, there is always a subgame perfect equilibrium in which either all the players in a group allocate positive resources in both stages or just some of them, but never only one player allocates a resource in any stage when all the others in his group are free riders.

Suggested Citation

  • Aner Sela, 2023. "Is there free riding in group contests?," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 11(2), pages 191-201, October.
    • Handle: RePEc:spr:etbull:v:11:y:2023:i:2:d:10.1007_s40505-023-00250-w
    DOI: 10.1007/s40505-023-00250-w
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    References listed on IDEAS

    as
    1. Konrad, Kai A., 2009. "Strategy and Dynamics in Contests," OUP Catalogue, Oxford University Press, number 9780199549603.
    2. Konrad, Kai A., 2004. "Bidding in hierarchies," European Economic Review, Elsevier, vol. 48(6), pages 1301-1308, December.
    3. Cohen, Din & Sela, Aner, 2020. "Common-value group contests with asymmetric information," Economics Letters, Elsevier, vol. 192(C).
    4. Stergios Skaperdas, 1996. "Contest success functions (*)," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 7(2), pages 283-290.
    5. Roman M. Sheremeta, 2018. "Behavior In Group Contests: A Review Of Experimental Research," Journal of Economic Surveys, Wiley Blackwell, vol. 32(3), pages 683-704, July.
    6. Kyung Baik, 2008. "Contests with group-specific public-good prizes," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 30(1), pages 103-117, January.
    7. Nitzan, Shmuel, 1991. "Collective Rent Dissipation," Economic Journal, Royal Economic Society, vol. 101(409), pages 1522-1534, November.
    8. Johannes Münster, 2009. "Group contest success functions," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 41(2), pages 345-357, November.
    9. Sela, Aner, 2022. "Effort allocations in elimination tournaments," Economics Letters, Elsevier, vol. 211(C).
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    More about this item

    Keywords

    Groups contests; Best-of-two contests; Free riders;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions

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