We use an experiment to study whether market competition can reduce anomalous behaviour in games. In different … treatments, we employ two alternative mechanisms, the random mechanism and the auction mechanism, to allocate the participation … rights to the red hat puzzle game, a well-known logical reasoning problem. Compared to the random mechanism, the auction …

suppliers. We also compare other common contests, in particular, fixed-prize tournaments and auctions. Like bonus tournaments …, auctions implement the socially optimal diversity, but usually with higher rents for the suppliers. Fixed-prize tournaments … implement insufficient diversity, but may nevertheless be preferred by the buyer to auctions because of lower supplier rents. …

-price auction. Before the contest, a fixed number of innovators is selected in an entry auction, in order to address the adverse …

Perfectly discriminating contests (or all pay auction) are widely used as a model of situations where individuals …