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Two-stage elimination contests with optimal head starts

Author

Listed:
  • Noam Cohen

    (Ben-Gurion University of the Negev)

  • Guy Maor

    (Ben-Gurion University of the Negev)

  • Aner Sela

    (Ben-Gurion University of the Negev)

Abstract

We study two-stage elimination Tullock contests. In the first stage all the players compete against each other; then some advance to the second stage while the others are removed. The finalists compete against each other in the second stage, and one of them wins the prize. To maximize the expected total effort, the designer can give a head start to the winner of the first stage when he competes against the other finalists in the second stage. We show that the optimal head start, independent of the number of finalists, always increases the players’ expected total effort. We also show how the number of players and finalists affect the value of the optimal head start.

Suggested Citation

  • Noam Cohen & Guy Maor & Aner Sela, 2018. "Two-stage elimination contests with optimal head starts," Review of Economic Design, Springer;Society for Economic Design, vol. 22(3), pages 177-192, December.
    • Handle: RePEc:spr:reecde:v:22:y:2018:i:3:d:10.1007_s10058-018-0216-1
    DOI: 10.1007/s10058-018-0216-1
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    Citations

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    Cited by:

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    3. Todd R. Kaplan & David Wettstein, 2022. "Two-stage contests with preferences over style," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 74(4), pages 1141-1161, November.
    4. Hou, Ting & Zhang, Wen, 2021. "Optimal two-stage elimination contests for crowdsourcing," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 145(C).
    5. James W. Boudreau & Timothy Mathews & Shane D. Sanders & Aniruddha Bagchi, 2022. "Conflicts with Momentum," Games, MDPI, vol. 13(1), pages 1-12, January.
    6. 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.
    7. Lu, Jingfeng & Lu, Yuanzhu & Wang, Zhewei & Zhou, Lixue, 2022. "Winner-leave versus loser-leave in multi-stage nested Tullock contests," Games and Economic Behavior, Elsevier, vol. 132(C), pages 337-352.
    8. 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.
    9. Doron Klunover, 2020. "Nice guys don't always finish last: succeeding in hierarchical organizations," Papers 2007.04435, arXiv.org, revised Sep 2020.
    10. 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.
    11. Klunover, Doron, 2021. "When sabotage fails," Mathematical Social Sciences, Elsevier, vol. 113(C), pages 164-168.
    12. Timothy Mathews & Soiliou Daw Namoro & James W. Boudreau, 2023. "The Impact of Organizer Market Structure on Participant Entry Behavior in a Multi-Tournament Environment," Games, MDPI, vol. 14(1), pages 1-21, January.

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    More about this item

    Keywords

    Multi-stage contests; Tullock contests; Head starts;
    All these keywords.

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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