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Preemptive behavior in sequential-move tournaments with heterogeneous agents

Author

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  • P.-J. Jost

    ()

  • M. Kräkel

    ()

Abstract

Rank-order tournaments are usually modeled simultaneously. However, real tournaments are often sequential. We show that agents' strategic behavior in sequential-move tournaments significantly differ from the one in simultaneous-move tournaments: In a sequential-move tournament with heterogeneous agents, the first acting agent may choose a preemptively high effort so that the following agent gives up. The principal is able to prevent preemptive behavior in equilibrium by choosing a sufficiently small spread between winner and loser prize. Copyright Springer-Verlag Berlin/Heidelberg 2005

Suggested Citation

  • P.-J. Jost & M. Kräkel, 2005. "Preemptive behavior in sequential-move tournaments with heterogeneous agents," Economics of Governance, Springer, vol. 6(3), pages 245-252, November.
  • Handle: RePEc:spr:ecogov:v:6:y:2005:i:3:p:245-252
    DOI: 10.1007/s10101-004-0088-4
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    Citations

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    Cited by:

    1. Jost, Peter-J. & Kräkel, Matthias, 2008. "Human capital investments in asymmetric corporate tournaments," Journal of Economics and Business, Elsevier, vol. 60(4), pages 312-331.
    2. Gürtler, Oliver, 2006. "Contractual Incentive Provision and Commitment in Rent-Seeking Contests," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 100, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
    3. Timothy Mathews & Tim Blumentritt, 2015. "A sequential choice model of family business succession," Small Business Economics, Springer, vol. 45(1), pages 15-37, June.

    More about this item

    Keywords

    Preemption; tournaments;

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