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Asymmetric contests with liquidity constraints

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  • Martin Grossmann
  • Helmut Dietl

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Suggested Citation

  • Martin Grossmann & Helmut Dietl, 2012. "Asymmetric contests with liquidity constraints," Public Choice, Springer, vol. 150(3), pages 691-713, March.
  • Handle: RePEc:kap:pubcho:v:150:y:2012:i:3:p:691-713
    DOI: 10.1007/s11127-010-9724-4
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    References listed on IDEAS

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    1. Pitchik, Carolyn & Schotter, Andrew, 1986. "Budget Constrained Sequential Auctions," Working Papers 86-21, C.V. Starr Center for Applied Economics, New York University.
    2. Benny Moldovanu & Aner Sela, 2001. "The Optimal Allocation of Prizes in Contests," American Economic Review, American Economic Association, vol. 91(3), pages 542-558, June.
    3. Ivan Pastine & Tuvana Pastine, 2010. "Political Campaign Spending Limits," Economics Department Working Paper Series n213-10.pdf, Department of Economics, National University of Ireland - Maynooth.
    4. Ivan Pastine & Tuvana Pastine, 2010. "Politician preferences, law-abiding lobbyists and caps on political contributions," Public Choice, Springer, vol. 145(1), pages 81-101, October.
    5. Che, Yeon-Koo & Gale, Ian L, 1998. "Caps on Political Lobbying," American Economic Review, American Economic Association, vol. 88(3), pages 643-651, June.
    6. Foellmi, Reto & Oechslin, Manuel, 2010. "Market imperfections, wealth inequality, and the distribution of trade gains," Journal of International Economics, Elsevier, vol. 81(1), pages 15-25, May.
    7. Steffen Huck & Kai A. Konrad & Wieland Müller, 2002. "Merger and Collusion in Contests," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 158(4), pages 563-575, December.
    8. Baik, Kyung Hwan & Kim, In-Gyu, 1997. "Delegation in contests," European Journal of Political Economy, Elsevier, vol. 13(2), pages 281-298, May.
    9. Kevin Milligan & Marie Rekkas, 2008. "Campaign spending limits, incumbent spending, and election outcomes," Canadian Journal of Economics, Canadian Economics Association, vol. 41(4), pages 1351-1374, November.
    10. Nti, Kofi O, 1997. "Comparative Statics of Contests and Rent-Seeking Games," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(1), pages 43-59, February.
    11. Yildirim, Huseyin, 2005. "Contests with multiple rounds," Games and Economic Behavior, Elsevier, vol. 51(1), pages 213-227, April.
    12. Steven M. Fazzari & R. Glenn Hubbard & Bruce C. Petersen, 1988. "Financing Constraints and Corporate Investment," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 19(1), pages 141-206.
    13. R. Glenn Hubbard, 1998. "Capital-Market Imperfections and Investment," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 193-225, March.
    14. Todd R. Kaplan & David Wettstein, 2006. "Caps on Political Lobbying: Comment," American Economic Review, American Economic Association, vol. 96(4), pages 1351-1354, September.
    15. Carolyn Pitchik & Andrew Schotter, 1988. "Perfect Equilibria in Budget-Constrained Sequential Auctions: An Experimental Study," RAND Journal of Economics, The RAND Corporation, vol. 19(3), pages 363-388, Autumn.
    16. Moldovanu, Benny & Sela, Aner, 2006. "Contest architecture," Journal of Economic Theory, Elsevier, vol. 126(1), pages 70-96, January.
    17. Dasgupta, Ani & Nti, Kofi O., 1998. "Designing an optimal contest," European Journal of Political Economy, Elsevier, vol. 14(4), pages 587-603, November.
    18. Arieh Gavious & Benny Moldovanu & Aner Sela, 2002. "Bid Costs and Endogenous Bid Caps," RAND Journal of Economics, The RAND Corporation, vol. 33(4), pages 709-722, Winter.
    19. Yeon-Koo Che & Ian Gale, 1998. "Standard Auctions with Financially Constrained Bidders," Review of Economic Studies, Oxford University Press, vol. 65(1), pages 1-21.
    20. repec:ags:afjare:141665 is not listed on IDEAS
    21. Kesenne, Stefan, 2000. "The Impact of Salary Caps in Professional Team Sports," Scottish Journal of Political Economy, Scottish Economic Society, vol. 47(4), pages 422-430, September.
    22. Fazzari, Steven M & Hubbard, R Glenn & Petersen, Bruce C, 1988. "Investment, Financing Decisions, and Tax Policy," American Economic Review, American Economic Association, vol. 78(2), pages 200-205, May.
    23. William Stein & Amnon Rapoport, 2005. "Symmetric two-stage contests with budget constraints," Public Choice, Springer, vol. 124(3), pages 309-328, September.
    24. Szymanski, Stefan & Valletti, Tommaso M., 2005. "Incentive effects of second prizes," European Journal of Political Economy, Elsevier, vol. 21(2), pages 467-481, June.
    25. Levitt, Steven D, 1994. "Using Repeat Challengers to Estimate the Effect of Campaign Spending on Election Outcomes in the U.S. House," Journal of Political Economy, University of Chicago Press, vol. 102(4), pages 777-798, August.
    26. Nti, Kofi O., 2004. "Maximum efforts in contests with asymmetric valuations," European Journal of Political Economy, Elsevier, vol. 20(4), pages 1059-1066, November.
    27. Dixit, Avinash K, 1987. "Strategic Behavior in Contests," American Economic Review, American Economic Association, vol. 77(5), pages 891-898, December.
    28. Mallesh M. Pai & Rakesh Vohra, 2008. "Optimal Auctions with Financially Constrained Bidders," Discussion Papers 1471, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
    29. Che, Yeon-Koo & Gale, Ian, 1997. "Rent Dissipation When Rent Seekers Are Budget Constrained," Public Choice, Springer, vol. 92(1-2), pages 109-126, July.
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    Citations

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    Cited by:

    1. Grossmann Martin & Lang Markus & Dietl Helmut, 2011. "Transitional Dynamics in a Tullock Contest with a General Cost Function," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 11(1), pages 1-26, August.
    2. Daisuke Hirata & Yuichiro Kamada, 2020. "Extreme donors and policy convergence," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 55(1), pages 149-176, June.
    3. Martin Grossmann, 2011. "Endogenous Liquidity Constraints in a Dynamic Contest," Working Papers 0148, University of Zurich, Institute for Strategy and Business Economics (ISU).
    4. Hirata, Daisuke & 平田, 大祐 & Kamada, Yuichiro & 鎌田, 雄一郎, 2019. "Extreme Lobbyists and Policy Convergence," Discussion Papers 2019-02, Graduate School of Economics, Hitotsubashi University.
    5. Grossmann, Martin & Dietl, Helmut, 2015. "Heterogeneous outside options in contests," European Journal of Political Economy, Elsevier, vol. 37(C), pages 280-287.
    6. Masaki Fujimoto, 2023. "A Dynamic Analysis of Equal Revenue Sharing and Endogenous Salary Caps in the N-Team Leagues," Journal of Sports Economics, , vol. 24(5), pages 624-638, June.
    7. Grossmann, Martin & Hottiger, Dieter, 2020. "Liquidity constraints and the formation of unbalanced contests," International Journal of Industrial Organization, Elsevier, vol. 73(C).
    8. Martin Grossmann, 2021. "Entry regulations and optimal prize allocation in parallel contests," Review of Economic Design, Springer;Society for Economic Design, vol. 25(4), pages 289-316, December.
    9. Malin Arve & Olga Chiappinelli, 2021. "The Role of Budget Constraints in Sequential Elimination Tournaments," Scandinavian Journal of Economics, Wiley Blackwell, vol. 123(4), pages 1059-1087, October.
    10. Martin Gregor, 2011. "Corporate lobbying: A review of the recent literature," Working Papers IES 2011/32, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Nov 2011.
    11. Anders Gustafsson & Patrik Gustavsson Tingvall & Daniel Halvarsson, 2020. "Subsidy Entrepreneurs: an Inquiry into Firms Seeking Public Grants," Journal of Industry, Competition and Trade, Springer, vol. 20(3), pages 439-478, September.

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    More about this item

    Keywords

    Asymmetric contests; Competitive balance; Liquidity constraints; Low-valuation bidder; High-valuation bidder; D43; D72; C72;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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