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Delegation in first-price all-pay auctions

Author

Listed:
  • Konrad, Kai A.

    (Free University of Berlin)

  • Peters, Wolfgang

    (The European University Viadrina)

  • Wärneryd, Karl

    (Dept. of Economics, Stockholm School of Economics)

Abstract

In a first-price all-pay auction buyers have an incentive to delegate the bidding to agents and to provide these agents with incentives to make bids that differ from the bids the buyers would like to make. Both buyers are better off in this strictly non-cooperative delegation equilibrium and the delegation contracts are asymmetric, even if the buyers and the auction are perfectly symmetric.

Suggested Citation

  • Konrad, Kai A. & Peters, Wolfgang & Wärneryd, Karl, 1999. "Delegation in first-price all-pay auctions," SSE/EFI Working Paper Series in Economics and Finance 316, Stockholm School of Economics.
    • Handle: RePEc:hhs:hastef:0316
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    Citations

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    Cited by:

    1. Martin Kolmar & Andreas Wagener, 2013. "Inefficiency As A Strategic Device In Group Contests Against Dominant Opponents," Economic Inquiry, Western Economic Association International, vol. 51(4), pages 2083-2095, October.
    2. Stefan Brandauer & Florian Englmaier, 2009. "A model of strategic delegation in contests between groups," Review of Economic Design, Springer;Society for Economic Design, vol. 13(3), pages 205-232, September.
    3. Kai A. Konrad & Florian Morath, 2018. "To Deter Or To Moderate? Alliance Formation In Contests With Incomplete Information," Economic Inquiry, Western Economic Association International, vol. 56(3), pages 1447-1463, July.
    4. Friedel Bolle & Philipp E. Otto, 2016. "Role-dependent Social Preferences," Economica, London School of Economics and Political Science, vol. 83(332), pages 704-740, October.
    5. Amegashie, J. Atsu & Kutsoati, Edward, 2007. "(Non)intervention in intra-state conflicts," European Journal of Political Economy, Elsevier, vol. 23(3), pages 754-767, September.
    6. Kyung Hwan Baik & Jong Hwa Lee, 2013. "Endogenous Timing In Contests With Delegation," Economic Inquiry, Western Economic Association International, vol. 51(4), pages 2044-2055, October.
    7. Krakel, Matthias & Sliwka, Dirk, 2006. "Strategic delegation and mergers in oligopolistic contests," Journal of Economics and Business, Elsevier, vol. 58(2), pages 119-136.
    8. Matthias Kräkel, 2004. "R&D spillovers and strategic delegation in oligopolistic contests," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 25(3), pages 147-156.
    9. Rosar, Frank, 2013. "Optimal procurement and outsourcing of production in small industries," VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79812, Verein für Socialpolitik / German Economic Association.
    10. Huck, Steffen & Konrad, Kai A. & Muller, Wieland, 2001. "Divisionalization in contests," Economics Letters, Elsevier, vol. 70(1), pages 89-93, January.
    11. Odd Rune Straume, 2006. "Managerial Delegation and Merger Incentives with Asymmetric Costs," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 162(3), pages 450-469, September.
    12. Rosar, Frank, 2017. "Strategic outsourcing and optimal procurement," International Journal of Industrial Organization, Elsevier, vol. 50(C), pages 91-130.
    13. Johannes Münster, 2007. "Contests with investment," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 28(8), pages 849-862.

    More about this item

    Keywords

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    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions

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