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Self-Allocation in Contests

Author

Listed:
  • Bernergård, Axel

    (Department of Social Sciences)

  • Wärneryd, Karl

    (Dept. of Economics)

Abstract

We consider contestants who must choose exactly one contest, out of several, to participate in. We show that when the contest technology is of a certain type, or when the number of contestants is large, a self-allocation equilibrium, i.e., one where no contestant would wish to change his choice of contest, results in the allocation of players to contests that maximizes aggregate equilibrium effort. For a class of oligopoly models that are equivalent to contests, this implies output maximization.

Suggested Citation

  • Bernergård, Axel & Wärneryd, Karl, 2017. "Self-Allocation in Contests," SSE Working Paper Series in Economics 2017:2, Stockholm School of Economics.
  • Handle: RePEc:hhs:hastec:2017_002
    as

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    References listed on IDEAS

    as
    1. Konrad, Kai A., 2009. "Strategy and Dynamics in Contests," OUP Catalogue, Oxford University Press, number 9780199549603.
    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.
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    4. Gordon Tullock, 1975. "On The Efficient Organization Of Trials," Kyklos, Wiley Blackwell, vol. 28(4), pages 745-762, November.
    5. Richard L. Fullerton & R. Preston McAfee, 1999. "Auctioning Entry into Tournaments," Journal of Political Economy, University of Chicago Press, vol. 107(3), pages 573-605, June.
    6. Ghazala Azmat & Marc Möller, 2009. "Competition among contests," RAND Journal of Economics, RAND Corporation, vol. 40(4), pages 743-768, December.
    7. Wojciech Olszewski & Ron Siegel, 2016. "Large Contests," Econometrica, Econometric Society, vol. 84, pages 835-854, March.
    8. Warneryd, Karl, 2001. "Replicating contests," Economics Letters, Elsevier, vol. 71(3), pages 323-327, June.
    9. Szidarovszky, Ferenc & Okuguchi, Koji, 1997. "On the Existence and Uniqueness of Pure Nash Equilibrium in Rent-Seeking Games," Games and Economic Behavior, Elsevier, vol. 18(1), pages 135-140, January.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Contests; self-allocation; effort maximization; quantity competition.;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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