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Affirmative Action through Extra Prizes

Author

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  • Matthias Dahm

    () (School of Economics, University of Nottingham)

  • Patricia Esteve

    () (Universitat Rovira i Virgili, Department d’Economia and CREIP, Av. de la Universitat 1, 43204 Reus, Spain)

Abstract

Some affirmative action policies establish that a set of disadvantaged competitors has access to an extra prize. We analyse the effects of creating an extra prize by reducing the prize in the main competition. Contestants differ in ability and agents with relatively low ability belong to a disadvantaged minority. All contestants compete for the main prize, but only disadvantaged agents can win the extra prize. We show that an extra prize is a powerful tool to ensure participation of disadvantaged agents. Moreover, for intermediate levels of the disadvantage of the minority, introducing an extra prize increases total equilibrium effort compared to a standard contest. Thus, even a contest designer not interested in affirmative action might establish an extra prize in order to enhance competition.

Suggested Citation

  • Matthias Dahm & Patricia Esteve, 2014. "Affirmative Action through Extra Prizes," Discussion Papers 2014-08, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
  • Handle: RePEc:not:notcdx:2014-08
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    Cited by:

    1. Matthias Dahm, 2017. "All-Pay Auctions with Extra Prize: A Partial Exclusion Principle," Discussion Papers 2017-01, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    2. Francesco Fallucchi & Simone Quercia, 2016. "Affirmative action and retaliation in experimental contests," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 16-03, School of Economics, University of East Anglia, Norwich, UK..
    3. Dahm, Matthias & Esteve, Patrícia,, 2013. "Affirmative Action through Extra Prizes," Working Papers 2072/222197, Universitat Rovira i Virgili, Department of Economics.
    4. Alexander Matros & David Michael Rietzke, 2017. "Contests on Networks," Working Papers 156630581, Lancaster University Management School, Economics Department.

    More about this item

    Keywords

    Asymmetric contest; equality of opportunity; affirmative action; discrimination; prize structure; exclusion principle;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J78 - Labor and Demographic Economics - - Labor Discrimination - - - Public Policy (including comparable worth)

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