This paper empirically analyzes how performance feedback and information on heterogeneity affect behavior in dynamic contests, using data on two-player-contests from a smartphone/tablet application called ``Wordblitz for Friends''. We find that players increase output as underdogs and decrease...

This paper analyzes the design of innovation contests when the quality of an innovation depends on the research approach of the supplier, but the best approach is unknown. Diversity of approaches is desirable because it generates an option value. In our main model with two suppliers, the buyer...

Optimal rank-order tournaments have traditionally been studied using a first-order approach. The present analysis relies instead on the construction of an "upper envelope" over all incentive compatibility conditions. It turns out that the first-order approach is not innocuous. For example, in...