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Behavioral variation in Tullock contests


  • Masiliunas, Aidas
  • Mengel, Friederike
  • Reiss, J. Philipp


We conduct an experiment to uncover the reasons behind the typically large behavioral variation and low explanatory power of Nash equilibrium observed in Tullock contests. In our standard contest treatment, only 7% of choices are consistent with Nash equilibrium which is in line with the literature and roughly what random (uniform) choice would predict (6.25%). We consider a large class of social, risk and some other non-standard preferences and show that heterogeneity in preferences cannot explain these results. We then systematically vary the complexity of both components of Nash behaviour: (I) the difficulty to form correct beliefs and (II) the difficulty to formulate best responses. In treatments where both the difficulty of forming correct beliefs and of formulating best responses is reduced behavioural variation decreases substantially and the explanatory behaviour of Nash equilibrium increases dramatically (explaining 65% of choices with a further 20% being close to NE). Our results show that bounded rationality rather than heterogeneity in preferences is the reason behind the huge behavioral variation typically observed in Tullock contests.

Suggested Citation

  • Masiliunas, Aidas & Mengel, Friederike & Reiss, J. Philipp, 2014. "Behavioral variation in Tullock contests," Working Paper Series in Economics 55, Karlsruhe Institute of Technology (KIT), Department of Economics and Business Engineering.
  • Handle: RePEc:zbw:kitwps:55

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    Cited by:

    1. Chen, Zhuoqiong (Charlie) & Ong, David & Sheremeta, Roman M., 2015. "The gender difference in the value of winning," Economics Letters, Elsevier, vol. 137(C), pages 226-229.
    2. Emmanuel Dechenaux & Dan Kovenock & Roman Sheremeta, 2015. "A survey of experimental research on contests, all-pay auctions and tournaments," Experimental Economics, Springer;Economic Science Association, vol. 18(4), pages 609-669, December.
    3. Subhasish M. Chowdhury & Anwesha Mukherjee & Theodore L. Turocy, 2016. "That's the ticket: Explicit lottery randomisation and learning in Tullock contests," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 16-07, School of Economics, University of East Anglia, Norwich, UK..
    4. repec:kap:expeco:v:20:y:2017:i:3:d:10.1007_s10683-016-9504-1 is not listed on IDEAS
    5. Cason, Timothy & Masters, William & Sheremeta, Roman, 2018. "Winner-Take-All and Proportional-Prize Contests: Theory and Experimental Results," MPRA Paper 84246, University Library of Munich, Germany.

    More about this item


    rent-seeking; contests; behavioural variation; Nash equilibrium; complexity;

    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
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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