Lepore, Jason J; Mackey, Alison; Mackey, Tyson B - In: Economics Bulletin 32 (2012) 4, pp. 3090-3097
We study when costly punishment induces higher expected effort than prizes in all-pay contests with perfect information. Punishment outperforms rewards if the number of players in the contest is large enough or if the principal can easily administer effective punishment. If the marginal cost of...