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Competitive outcomes in a Cournot-Tullock contest

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  • Robertson, Matthew J.

Abstract

I endogenise the value of the prize in an N-player Tullock contest as the total market revenue obtained in Cournot competition under linear inverse demand. The contest designer, by choosing the parameter relating players’ outputs to their share of market revenue, can maximise total surplus by implementing the perfectly competitive outcome. In contrast, the parameter that maximises players’ payoffs leads them to produce one-half of the perfectly competitive output, which is equivalent to 1/N of the monopoly output.

Suggested Citation

  • Robertson, Matthew J., 2025. "Competitive outcomes in a Cournot-Tullock contest," Economics Letters, Elsevier, vol. 250(C).
    • Handle: RePEc:eee:ecolet:v:250:y:2025:i:c:s0165176525001223
    DOI: 10.1016/j.econlet.2025.112285
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    References listed on IDEAS

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    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General

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