This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

research article : Contests where there is variation in the marginal productivity of effort

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Nirvikar Singh () (Economics Department, University of California, Santa Cruz, CA 95064, USA)
Donald Wittman () (Economics Department, University of California, Santa Cruz, CA 95064, USA)

Additional information is available for the following registered author(s):

Abstract

We provide a characterization of participants' behavior in a contest or tournament where the marginal productivity of effort varies across contestants and individual productivity is private information. We then consider the optimal design of such a contest.

We first analyze contestant behavior for the usual type of contest, where the highest output wins. Abilities need not be independently distributed. We demonstrate that there is a unique symmetric equilibrium output function, that output is increasing in ability, and that marginal effort is increasing in ability, while effort decreases when the cost of effort increases.

Next we consider the case where the highest output need not win, with independently distributed abilities. We analyze the contest designer's decisions in choosing contest rules optimal from her perspective. We show that the output produced, probability of winning, and contest designer's expected revenue are generally increasing in contestants' ability. We examine the relationship between the marginal cost of producing output and marginal utility per dollar of the net award for winning.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://link.springer.de/link/service/journals/00199/papers/1018003/10180711.pdf
File Format: application/pdf
File Function:
Download Restriction: Access to the full text of the articles in this series is restricted

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Publisher Info
Article provided by Springer in its journal Economic Theory.

Volume (Year): 18 (2001)
Issue (Month): 3 ()
Pages: 711-744
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:spr:joecth:v:18:y:2001:i:3:p:711-744

Note: Received: July 30, 1998; revised version: August 7, 2000
Contact details of provider:
Web page: http://link.springer.de/link/service/journals/00199/index.htm

Order Information:
Web: http://link.springer.de/orders.htm

For technical questions regarding this item, or to correct its listing, contact: (Christopher F Baum).

Related research
Keywords: Optimal contest; Contest design; Asymmetric information; Correlated abilities.;

Find related papers by JEL classification:
D3 - Microeconomics - - Distribution
D8 - Microeconomics - - Information, Knowledge, and Uncertainty
J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

Statistics
Access and download statistics

Did you know? You too can volunteer for RePEc, for example by providing information about publications in your institution.

This page was last updated on 2009-12-30.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.