Maximum efforts in contests with asymmetric valuations

Kofi O. Nti ()
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Kofi O. Nti: University of Ghana

A chapter in 40 Years of Research on Rent Seeking 1, 2004, pp 581-588 from Springer

Abstract: Abstract Efforts may be reduced when players with different valuations participate in a contest. This paper considers the problem of designing a contest to elicit maximum aggregate effort from players with asymmetric valuations. Optimal designs for different classes of contest technologies are computed and characterized. A value weighted contest is optimal in the concave case. In the unconstrained case, the optimal contest is equivalent to a first price all-pay auction with a reserve price. The optimal design discounts the effort of the high valuation player in order to induce him to compete vigorously.

Keywords: Contest design; Asymmetric contests; Rent-seeking (search for similar items in EconPapers)
JEL-codes: C72 D72 (search for similar items in EconPapers)
Date: 2004
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-540-79182-9_42

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DOI: 10.1007/978-3-540-79182-9_42

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