Manipulation of moves in sequential contests

Bibliographic Data

ID21470433
AuthorsKonstantinos Protopappas (0000-0001-6044-7259, Universität Innsbruck, corresponding author)
Year2023
Volume61
Issue3
Pages511-535
Publication date2023-10-01
Open AccessYes
TypeARTICLE
VenueSocial Choice and Welfare (JOURNAL)
Journal identifiersISSN: 0176-1714 • E-ISSN: 1432-217X
PublisherSpringer Science and Business Media LLC (PUBLISHER)
DOI10.1007/s00355-023-01461-7
OpenAlexW4376139890
LanguageEN
Citations received1
References cited25

In two-player Tullock contests with endogenous timing of moves, the weak player moves early and the strong player follows. This order of moves is the third-best outcome for a contest organiser as it leads to a contest with lower aggregate effort compared to a contest where the players move in reverse order (first best) or simultaneously (second best). We propose that if the contest organiser—who does not know ex ante which player is the strong and which is the weak one—offers a lower price (effort cost) to the player(s) who choose(s) to exert effort early, she can achieve a greater payoff by affecting the contestants’ sequence of moves. We show that there exists no price that generates the first-best outcome. However, there is a price (or a range of prices) that induces both players to move early and receive it, leading to the second-best outcome. We also discuss the case where both players move early but only one receives the low price, e.g., lobbying or Instagram “giveaway” contests

CONTEST · Economics · Ex-ante · Keynesian economics · Mathematical economics · Microeconomics · Political science · Public finance · Stochastic game · Auction Theory and Applications · Experimental Behavioral Economics Studies · Law · Sports Analytics and Performance · Finance

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