It's not always best to be first

Aner Sela

No 12887, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We study a model with n agents, each of whom has both a linear reward function that increases in the agent's effort and an effort constraint. However, since the effort (output) of the players has a negative effect on society the designer imposes a punishment such that the agent with the highest effort who caused the greatest damage is punished. We analyze the equilibrium of this model with either symmetric or asymmetric agents. At all the equilibrium points, all the agents are active and all have positive expected payoffs. We characterize the properties of the agents' equilibrium strategies and compare them to the well-known equilibrium strategies of the all-pay auction in which the agent with the highest effort wins a prize.

Keywords: Contests; Winner's curse (search for similar items in EconPapers)
Date: 2018-04
New Economics Papers: this item is included in nep-des, nep-gth and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://cepr.org/publications/DP12887 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

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:cpr:ceprdp:12887

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP12887

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().