We document that eBay bidders exhibit a biased preference for auctions with more bids, even if these are non-diagnostic of quality, creating an incentive for sellers to lower starting prices to attract early bids. We find that lowering starting prices succeeds in increasing the likelihood that...

This article studies the optimal design of scoring auctions used in public and private procurement. In this auction, each supplier's offer consists of both price and quality, and a supplier whose offer achieves the highest score wins. The environment we consider has the feature that quality is...

We consider multi-stage elimination contests, where agents efforts at different stages generate some output for the organizers. Depending on the output function we characterize the optimal prize structure of the tournament and show that it is almost efficient. We have found that in some cases...

We investigate how individual risk preferences affect the likelihood of selecting the more able contestant within a two-player Tullock contest. Our theoretical model yields two main predictions: First, an increase in the risk aversion of a player worsens her odds unless she already has a...

We investigate how individual risk preferences affect the likelihood of selecting the more able contestant within a two-player Tullock contest. Our theoretical model yields two main predictions: First, an increase in the risk aversion of a player worsens her odds unless she already has a...

We establish the existence and uniqueness of pure-strategy equilibrium in two-worker rank order contests with sabotage while allowing interdependent effects of productive and sabotage effort. We find that diverging marginal costs in workers' productive effort discourage sabotage activity. For...

A contest is a situation in which individuals expend resources in order to win valuable prize(s). 'Sabotage' is a deliberate, and often costly and illegal, act of damaging a rival's likelihood of winning the contest. It is done by exerting resources to negatively influence the effectiveness of a...

We introduce a general class of simplicity standards that vary the foresight abilities required of agents in extensive-form games. Rather than planning for the entire future of a game, agents are presumed to be able to plan only for those histories they view as simple from their current...

Brazil, Chile and other developing countries have recently experienced with forward or long-run contract auctions for electricity demand, to meet supply adequacy problems. In this paper, we analyze what it requires to have a competitive auction process for this type of contracts when each bidder...

We introduce a general class of simplicity standards that vary the foresight abilities required of agents in extensive-form games. Rather than planning for the entire future of a game, agents are presumed to be able to plan only for those histories they view as simple from their current...