Intra-group heterogeneity in collective contests

Shmuel Nitzan and Kaoru Ueda ()

Social Choice and Welfare, 2014, vol. 43, issue 1, 219-238

Abstract: Collective contests are examined permitting heterogeneity of stakes within every competing group. Our first concern is whether unequal distribution of stakes in a group can enhance its win probability. Our second concern is whether a large stake in a group can be individually disadvantageous. We find that if a contest is sufficiently “hard” for a group, the answers to these questions are positive under plausible conditions. In such situations, monopoly of the private stake is most effective in enhancing the group’s performance. Ironically, in the same cases, the welfare of many group members would be negatively related to the size of their individual stake. Copyright Springer-Verlag Berlin Heidelberg 2014

Date: 2014
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Working Paper: Intra-Group Heterogeneity in Collective Contests (2013)
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DOI: 10.1007/s00355-013-0762-y

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