On the Survival of Payoff Maximizing Behavior and Delegation in Contests
Alex Possajennikov ()
No 2008-15, Discussion Papers from The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham
The evolutionary stability of payoff-maximizing preferences in the model of indirect evolution in symmetric games depends on the slope of the reaction function being zero at equilibrium. The application of this result to contests confirms that in two-player contests the optimal delegation involves giving the agent incentives to maximize principal's payoff while in contests with more than two players incentives will be different from principal's payoff maximization. Further examples are also discussed.
Keywords: delegation; indirect evolution; contests (search for similar items in EconPapers)
JEL-codes: C72 D02 (search for similar items in EconPapers)
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Working Paper: On the Survival of Payoff Maximizing Behavior and Delegation in Contests (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:cdx:dpaper:2008-15
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