Overbidding and heterogeneous behavior in contest experiments:A meta-comment on cross-cultural differences

Subhasish Chowdhury and Matteo M. Marini

Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), 2024, vol. 110, issue C

Abstract: We revisit the analyses by Sheremeta (2013) and Chowdhury and Moffatt (2017), who pool experimental data from 30 Tullock contests to explain the phenomenon of overbidding. The authors find that the overbidding rate is positively related to the number of contestants and has an inverted U-shaped relationship with the relative endowment. We reuse their data and extend the analysis in the direction of cross-cultural differences, focusing on ethno-linguistic-religious fractionalization as a country-level measure. The results suggest an increased explanatory power of the model, with fractionalization negatively relating to overbidding. In addition, the extended model shows that in the one-shot game the overbidding rate is significantly higher than in the case of repeated interactions. We discuss possible interpretations of our findings.

Keywords: Meta-analysis; Contests; Experiments; Overbidding; Fractionalization (search for similar items in EconPapers)
JEL-codes: C90 D72 D74 (search for similar items in EconPapers)
Date: 2024
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Working Paper: Overbidding and Heterogeneous Behavior in Contest Experiments: A Meta-Comment on Cross-Cultural Differences (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:soceco:v:110:y:2024:i:c:s221480432400048x

DOI: 10.1016/j.socec.2024.102210

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