Top Guns May Not Fire: Best-Shot Group Contests with Group-Specific Public Good Prizes

Subhasish Chowdhury, Dongryul Lee and Roman Sheremeta
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Dongryul Lee: School of Technology Management, UNIST

No 24, University of East Anglia Applied and Financial Economics Working Paper Series from School of Economics, University of East Anglia, Norwich, UK.

Abstract: We analyze a group contest in which n groups compete to win a group-specific public good prize. Group sizes can be different and any individual player may value the prize differently within and across groups. Players expend costly efforts simultaneously and independently. Only the highest effort (the best-shot) within each group represents the group effort and the winning group is determined by a contest success function. We fully characterize the set of equilibria and show that in any equilibrium at most one player in each group exerts strictly positive effort. There always exists an equilibrium in which only the highest value player in each active group expends positive effort and the contest is reduced to an individual contest between individual players. However, there may also be equilibria in which the highest value players completely free ride on others by exerting no effort. We provide conditions under which this can be avoided and discuss contest design implications.

Keywords: Best-shot technology; Group contest; Group-specific public goods (search for similar items in EconPapers)
JEL-codes: C72 D70 D72 H41 (search for similar items in EconPapers)
Date: 2011-03-15
New Economics Papers: this item is included in nep-cbe and nep-gth
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: Top guns may not fire: Best-shot group contests with group-specific public good prizes (2013)
Working Paper: Top Guns May Not Fire: Best-Shot Group Contests with Group-Specific Public Good Prizes (2013)
Working Paper: Top Guns May Not Fire: Best-Shot Group Contests with Group-Specific Public Good Prizes (2013)
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