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Disclosure and Favoritism in Sequential Elimination Contests

Author

Listed:
  • Qiang Fu
  • Zenan Wu

Abstract

We consider a two-stage contest, in which only a subset of contestants enters the finale. We explore the optimal policy for disclosing contestants' interim status after the preliminary round, i.e., their interim ranking and elimination decision. The optimum depends on the design objective. We fully characterize the conditions under which disclosure or concealment emerges as the optimum. We further allow the organizer to bias the competition based on finalists' interim rankings, which endogenizes the dynamic structure of the contest. Concealment outperforms in generating total effort, while disclosure prevails when maximizing the expected winner's total effort.

Suggested Citation

  • Qiang Fu & Zenan Wu, 2022. "Disclosure and Favoritism in Sequential Elimination Contests," American Economic Journal: Microeconomics, American Economic Association, vol. 14(4), pages 78-121, November.
    • Handle: RePEc:aea:aejmic:v:14:y:2022:i:4:p:78-121
    DOI: 10.1257/mic.20200230
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    Citations

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    Cited by:

    1. Li, Bo & Wu, Zenan & Xing, Zeyu, 2023. "Optimally biased contests with draws," Economics Letters, Elsevier, vol. 226(C).
    2. Elias Dinopoulos & Constantinos Syropoulos & Theofanis Tsoulouhas, 2023. "Global Innovation Contests," Games, MDPI, vol. 14(1), pages 1-24, February.
    3. Fu, Qiang & Wu, Zenan & Zhu, Yuxuan, 2023. "On equilibrium uniqueness in generalized multi-prize nested lottery contests," Games and Economic Behavior, Elsevier, vol. 139(C), pages 180-199.
    4. Wasser, Cédric & Zhang, Mengxi, 2023. "Differential treatment and the winner's effort in contests with incomplete information," Games and Economic Behavior, Elsevier, vol. 138(C), pages 90-111.
    5. Huang, Ying & Jiao, Qian & Shen, Bo & Sun, Xiang, 2023. "Conflicts in regular networks," Journal of Mathematical Economics, Elsevier, vol. 106(C).

    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure

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