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An experimental study of sorting in group contests

Author

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  • Philip Brookins

    () (Department of Economics, Florida State University)

  • John Lightle

    () (Department of Economics, Florida State University)

  • Dmitry Ryvkin

    () (Department of Economics, Florida State University)

Abstract

We study experimentally the effects of sorting in contests between groups of heterogeneous players whose within-group efforts are perfect substitutes. The theory predicts that higher aggregate effort will be reached when variation in ability between groups is lower, i.e., by a more balanced sorting. In the experiment, we assign subjects to four types -- A, B, C, and D -- ranked by their cost of effort, with A having the lowest and D having the highest cost, and conduct contests between two groups of two players each. In the Balanced treatment, (A,D) groups (i.e., groups comprised of a type A and a type D player) compete with (B,C) groups, whereas in the Unbalanced treatment, (A,B) groups compete with (C,D) groups. We find substantial heterogeneity and overinvestment of efforts by all types in both treatments, including the "underdog" (C,D) group which surprisingly is not demoralized by the unbalanced matching. Despite strong overbidding, relative aggregate efforts are remarkably close to equilibrium predictions both between treatments and between groups within each treatment. The results confirm the prediction that balanced sorting leads to higher aggregate effort.

Suggested Citation

  • Philip Brookins & John Lightle & Dmitry Ryvkin, 2014. "An experimental study of sorting in group contests," Working Papers wp2014_01_01, Department of Economics, Florida State University.
  • Handle: RePEc:fsu:wpaper:wp2014_01_01
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Herbst, Luisa & Konrad, Kai A. & Morath, Florian, 2017. "Balance of power and the propensity of conflict," Games and Economic Behavior, Elsevier, vol. 103(C), pages 168-184.
    2. Roman M. Sheremeta, 2013. "Overbidding And Heterogeneous Behavior In Contest Experiments," Journal of Economic Surveys, Wiley Blackwell, vol. 27(3), pages 491-514, July.
    3. Fallucchi, Francesco & Renner, Elke & Sefton, Martin, 2013. "Information feedback and contest structure in rent-seeking games," European Economic Review, Elsevier, vol. 64(C), pages 223-240.
    4. FALLUCCHI Francesco & RAMALINGAM Abhijit, 2017. "Inequality and Competitive Effort: The Roles of Asymmetric Resources, Opportunity and Outcomes," LISER Working Paper Series 2017-12, LISER.
    5. Sheremeta, Roman, 2015. "Behavior in Group Contests: A Review of Experimental Research," MPRA Paper 67515, University Library of Munich, Germany.
    6. Philip Brookins & John P. Lightle & Dmitry Ryvkin, 2015. "The effects of communication and sorting on output in heterogeneous weak-link group contests," Working Papers wp2014_01_01, Department of Economics, Florida State University.
    7. Cortney Rodet & Andrew Smyth, 2018. "Experimental Evidence on the Cyclicality of Investment," Working Papers 18-02, Chapman University, Economic Science Institute.
    8. Michael Kurschilgen & Alexander Morell & Ori Weisel, 2016. "Internal conflict, market uniformity, and transparency in price competition between teams," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2016_18, Max Planck Institute for Research on Collective Goods.
    9. Erik O. Kimbrough & Roman M. Sheremeta & Timothy Shields, 2011. "Resolving Conflicts by a Random Device," Working Papers 11-09, Chapman University, Economic Science Institute.

    More about this item

    Keywords

    contest; group; sorting; heterogeneous players; experiment;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • M54 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Labor Management
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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