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Sad-Loser contests

Listed author(s):
  • Matros, Alexander

We consider asymmetric winner-reimbursed contests. It turns out that such contests (Sad-Loser) have multiple internal pure-strategy equilibria (where at least two players are active). We describe all equilibria and discuss their properties. In particular, we find (1) that an active player is indifferent among all her non-negative choices and her expected payoff is zero in any internal equilibrium, (2) that a higher-value (stronger) player always spends less than a lower-value (weaker) player and therefore always has a lower chance to win a Sad-Loser contest in any internal equilibrium, and (3) a sufficient condition for a net total spending to be higher in a Sad-Loser contest than in the corresponding asymmetric contest.

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File URL: http://www.sciencedirect.com/science/article/pii/S0304406812000213
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Article provided by Elsevier in its journal Journal of Mathematical Economics.

Volume (Year): 48 (2012)
Issue (Month): 3 ()
Pages: 155-162

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Handle: RePEc:eee:mateco:v:48:y:2012:i:3:p:155-162
DOI: 10.1016/j.jmateco.2012.03.001
Contact details of provider: Web page: http://www.elsevier.com/locate/jmateco

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