EconPapers    
Economics at your fingertips  
 

Risk and risk aversion effects in contests with contingent payments

Liqun Liu (), Jack Meyer (), Andrew J. Rettenmaier () and Thomas R. Saving ()
Additional contact information
Liqun Liu: Texas A&M University
Andrew J. Rettenmaier: Texas A&M University
Thomas R. Saving: Texas A&M University

Journal of Risk and Uncertainty, 2018, vol. 56, issue 3, 289-305

Abstract: Abstract Contests by their very nature involve risk, winning and losing are both possible, and the gain from winning can itself be uncertain. The participants in a contest use resources to increase their chance of winning. The main focus of this analysis is on the effects of risk aversion and risk in contests where only winners pay for resources used to compete. When payment is contingent on winning, the effect of risk aversion is in the opposite direction of what occurs when costs are paid by both winners and losers. A number of contests observed in the marketplace that exhibit this contingent payment property are discussed.

Keywords: Risk aversion; Contests; Contingent payments; Self-protection; Ross risk aversion; Downside risk aversion; C72; D72; D81 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://link.springer.com/10.1007/s11166-018-9283-5 Abstract (text/html)
Access to full text is restricted to subscribers.

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:kap:jrisku:v:56:y:2018:i:3:d:10.1007_s11166-018-9283-5

Ordering information: This journal article can be ordered from
http://www.springer. ... ry/journal/11166/PS2

Access Statistics for this article

Journal of Risk and Uncertainty is currently edited by W. Kip Viscusi

More articles in Journal of Risk and Uncertainty from Springer
Bibliographic data for series maintained by Sonal Shukla ().

 
Page updated 2019-04-09
Handle: RePEc:kap:jrisku:v:56:y:2018:i:3:d:10.1007_s11166-018-9283-5