Return on Investment in Contest

Yizhaq Minchuk (), Baruch Keren () and Yossi Hadad ()
Additional contact information
Yizhaq Minchuk: Industrial Engineering and Management Department, Shamoon College of Engineering
Baruch Keren: Department of Industrial Engineering and Management, Shamoon College of Engineering
Yossi Hadad: Department of Industrial Engineering and Management, Shamoon College of Engineering

Economics Bulletin, 2018, vol. 38, issue 4, 2073-2078

Abstract: This paper considers a contest with one organizer and two (or more) contestants that compete to win a prize that is set by the organizer (the winner takes all). In the first stage, the organizer determines the amount of money he needs to borrow in order to establish the prize of the contest. In the second stage, each contestant determines his efforts in the contest. The contest prize is determined according to the abilities of all the contestants and the cost of the loan. It is shown that if the organizer borrows the optimal amount of money for the prize, in some situations this setup can yield 100% return on investment (ROI).

Keywords: Contest; Strategy; Return on investment (search for similar items in EconPapers)
JEL-codes: D7 E2 (search for similar items in EconPapers)
Date: 2018-11-06
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.accessecon.com/Pubs/EB/2018/Volume38/EB-18-V38-I4-P191.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ebl:ecbull:eb-18-00550

Access Statistics for this article

More articles in Economics Bulletin from AccessEcon
Bibliographic data for series maintained by John P. Conley ().