Optimal accuracy of unbiased Tullock contests with two heterogeneous players

Marco Sahm

No 175, BERG Working Paper Series from Bamberg University, Bamberg Economic Research Group

Abstract: I characterize the optimal accuracy level r of an unbiased Tullock contest between two players with heterogeneous prize valuations. The designer maximizes the winning probability of the strong player or the winner's expected valuation by choosing a contest with an all-pay auction equilibrium (r ≥ 2). By contrast, if she aims at maximizing the expected aggregate effort or the winner's expected effort, she will choose a contest with a pure-strategy equilibrium, and the optimal accuracy level r

Keywords: Tullock Contest; Heterogeneous Valuations; Accuracy; Discrimination; Optimal Design; All-Pay Auction (search for similar items in EconPapers)
JEL-codes: C72 D72 (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-des, nep-gth, nep-mic and nep-ore
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:bamber:175

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