This paper suggests a potential rationale for the recent empirical finding that overconfident agents tend to self-select into more competitive environments (e.g. Dohmen and Falk, forthcoming). In particular, it shows that moderate overconfidence in a contest can improve the agent's performance...

This paper suggests a potential rationale for the recent empirical finding that overconfident agents tend to self-select into more competitive environments (e.g. Dohmen and Falk, 2006). In particular, it shows that moderate overconfidence in a contest can improve the agent's performance relative...

In many markets, sellers advertise their good with an asking price. This is a price at which the seller is willing to take his good off the market and trade immediately, though it is understood that a buyer can submit an offer below the asking price and that this offer may be accepted if the...

In economic contests or tournaments where monitoring of the actions taken by contestants is imperfect competition is likely to drive not just work effort but other choices at the workers' discretion that increase the probability of winning. For example, when workers compete for promotion,...

We investigate refinements of two solutions, the saddle and the weak saddle, defined by Shapley (1964) for two-player zero-sum games. Applied to weak tournaments, the first refinement, the mixed saddle, is unique and gives us a new solution, generally lying between the GETCHA and GOTCHA sets of...