Tournaments with midterm reviews
In many tournaments investments are made over time. The question whether to conduct a review once at the end, or additionally at points midway through the tournament, is a strategic decision. If the latter course is chosen, then the designer must establish both a rule for aggregating the results of the different reviews and a rule for determining compensations. We first study the case of a fixed, exogenously given prize and then extend the analysis to the case where the prize is not fixed but may vary with the tournament's outcome. It is shown that (1) it is always optimal to assign a higher weight to the final review; (2) this weight increases with the dominance of the first-stage effort in determining the final review's outcome. When the prize is not fixed, the optimal design generates an asymmetric tournament in the second stage that favors the winner of the midterm review.
If you experience problems downloading a file, check if you have the proper application to view it first. 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.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
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.:
- Dubey, Pradeep & Haimanko, Ori, 2003.
"Optimal scrutiny in multi-period promotion tournaments,"
Games and Economic Behavior,
Elsevier, vol. 42(1), pages 1-24, January.
- Pradeep Dubey & Ori Haimanko, 2000. "Optimal Scrutiny in Multi-Period Promotion Tournaments," Cowles Foundation Discussion Papers 1254, Cowles Foundation for Research in Economics, Yale University.
- Yildirim, Huseyin, 2005. "Contests with multiple rounds," Games and Economic Behavior, Elsevier, vol. 51(1), pages 213-227, April.
- Lazear, Edward P & Rosen, Sherwin, 1981.
"Rank-Order Tournaments as Optimum Labor Contracts,"
Journal of Political Economy,
University of Chicago Press, vol. 89(5), pages 841-64, October.
- Sherwin Rosen, 1985.
"Prizes and Incentives in Elimination Tournaments,"
NBER Working Papers
1668, National Bureau of Economic Research, Inc.
- Jerry R. Green & Nancy L. Stokey, 1982.
"A Comparison of Tournaments and Contracts,"
NBER Working Papers
0840, National Bureau of Economic Research, Inc.
- Moldovanu, Benny & Sela, Aner, 1999.
"The Optimal Allocation of Prizes in Contests,"
Sonderforschungsbereich 504 Publications
99-75, Sonderforschungsbereich 504, Universität Mannheim;Sonderforschungsbereich 504, University of Mannheim.
- Moldovanu, Benny & Sela, Aner, 2006.
Journal of Economic Theory,
Elsevier, vol. 126(1), pages 70-96, January.
- Gradstein, Mark & Konrad, Kai A, 1999. "Orchestrating Rent Seeking Contests," Economic Journal, Royal Economic Society, vol. 109(458), pages 536-45, October.
- Dixit, Avinash K, 1987. "Strategic Behavior in Contests," American Economic Review, American Economic Association, vol. 77(5), pages 891-98, December.
- Florian Ederer, 2010. "Feedback and Motivation in Dynamic Tournaments," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 19(3), pages 733-769, 09.
- Margaret A. Meyer, 1991. "Learning from Coarse Information: Biased Contests and Career Profiles," Review of Economic Studies, Oxford University Press, vol. 58(1), pages 15-41.
- Masaki Aoyagi, 2003.
"Information Feedback in a Dynamic Tournament,"
ISER Discussion Paper
0580, Institute of Social and Economic Research, Osaka University.
When requesting a correction, please mention this item's handle: RePEc:eee:gamebe:v:66:y:2009:i:1:p:162-190. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If references are entirely missing, you can add them using this form.