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A well-known theoretical result in the contest literature is that greater heterogeneity decreases performance of contestants because of the "discouragement effect." Leveling the playing field by favoring weaker contestants through bid-caps and favorable tie-breaking rules can reduce the...
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Costly competitions between economic agents are modeled as contests. Researchers use laboratory experiments to study contests and test comparative static predictions of contest theory. Commonly, researchers find that participants' efforts are significantly higher than predicted by the standard...
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Contests are well-established mechanisms for political lobbying, innovation, rentseeking, incentivizing workers, and advancing R&D. A well-known theoretical result in the contest literature is that greater heterogeneity decreases investments of contestants because of the "discouragement effect."...
Persistent link: https://www.econbiz.de/10012426931
A well-known theoretical result in the contest literature is that greater heterogeneity decreases performance of contestants because of the "discouragement effect." Leveling the playing field by favoring weaker contestants through bid-caps and favorable tie-breaking rules can reduce the...
Persistent link: https://www.econbiz.de/10011473683
Contests are commonly used in the workplace to motivate workers, determine promotion, and assign bonuses. Although contests can be very effective at eliciting high effort, they can also lead to inefficient effort expenditure (overbidding). Researchers have proposed various theories to explain...
Persistent link: https://www.econbiz.de/10014132470
This paper shows the possibility of higher welfare under Cournot competition in an asymmetric cost duopoly when the … higher under Cournot competition compared to Bertrand competition when the initial cost difference of these firms is moderate …; but, for very small or very large cost initial cost differences, welfare is higher under Bertrand competition. If …
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