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Disclosure policies in research contests with stochastic entry

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  • Chen, Bo

Abstract

This paper models research contests as an all-pay auction with stochastic entry and analyzes the effect of disclosing the actual number of participants on the expected winning bid. I find that the classic disclosure irrelevance principle on expected revenue does not extend to the ranking on expected winning bid. The ranking on expected winning bid crucially depends on the number of potential bidders, participation probabilities, and the distribution of bidders’ valuations. When there are more than two potential bidders, fully concealing the actual number of participants elicits a higher expected winning bid if potential bidders have low participation probabilities, whereas the rank reverses if bidders have high participation probabilities and high chances of being high types.

Suggested Citation

  • Chen, Bo, 2020. "Disclosure policies in research contests with stochastic entry," Economics Letters, Elsevier, vol. 191(C).
    • Handle: RePEc:eee:ecolet:v:191:y:2020:i:c:s0165176520301026
    DOI: 10.1016/j.econlet.2020.109122
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    Cited by:

    1. Xiangyu Wang & Shulin Liu, 2023. "Disclosure policies in all‐pay auctions with bid caps and stochastic entry: The impact of risk aversion," Bulletin of Economic Research, Wiley Blackwell, vol. 75(4), pages 1181-1190, October.

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    More about this item

    Keywords

    Contest; All-pay auction; Stochastic entry; Disclosure;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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