J. Atsu Amegashie () (Department of Economics, University of Guelph)
Abstract
I consider a two-stage elimination contest with uninformed and informed players. Informed players can signal their type to future uninformed opponents through their efforts in the first stage. Relative to the benchmark case of complete information, I find that an informed player exerts a higher effort in stage 1, if the uninformed future opponent is weaker than him. Conversely, he exerts a lower effort, if the uninformed opponent is stronger than him. This result is consistent with a conjecture in Rosen (AER, 1986). Intuitively, informed players may want to scare future uninformed opponents by exerting higher efforts in earlier rounds. However, trying to scare a stronger player may not be a sensible strategy because he might compete very fiercely. In equilibrium, informed players who are stronger than uninformed players separate from informed players who are weaker than uninformed players. This result differs from Horner and Sahuguet (2003) where stronger informed players pool with weaker informed players.
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.
Publisher Info
Paper provided by University of Guelph, Department of Economics in its series Working Papers with number
0511.
Find related papers by JEL classification: D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Models of Political Processes: Rent-seeking, Elections, Legislatures, and Voting Behavior D44 - Microeconomics - - Market Structure and Pricing - - - Auctions D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Brunnermeier, Markus K & Parker, Jonathan A, 2004.
"Optimal Expectation,"
CEPR Discussion Papers
4656, C.E.P.R. Discussion Papers.
[Downloadable!] (restricted)
Other versions:
Markus K. Brunnermeier & Jonathan A. Parker, 2004.
"Optimal Expectations,"
NBER Working Papers
10707, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
Markus K. Brunnermeier & Jonathan A. Parker, 2002.
"Optimal Expectations,"
Working Papers
146, Princeton University, Woodrow Wilson School of Public and International Affairs, Discussion Papers in Economics..
[Downloadable!]
Markus K. Brunnermeier & Jonathan A. Parker, 2005.
"Optimal Expectations,"
American Economic Review,
American Economic Association, vol. 95(4), pages 1092-1118, September.
[Downloadable!]
Rick Harbaugh & Tilman Klumpp, 2004.
"Early Round Upsets and Championship Blowouts,"
Working Papers
2004-09, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy.
[Downloadable!]
Other versions:
Christian Groh & Benny Moldovanu & Aner Sela & Uwe Sunde, 2003.
"Optimal Seedings in Elimination Tournaments,"
Discussion Papers
140, SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
[Downloadable!]