An axiomatization of difference-form contest success functions

Santiago Sánchez-Pagés and Maria Cubel

Edinburgh School of Economics Discussion Paper Series from Edinburgh School of Economics, University of Edinburgh

Abstract: This paper presents an axiomatic characterization of difference-form group contests, that is, contests fought among groups and where their probability of victory depends on the difference of their effective efforts. This axiomatization rests on the property of Equalizing Consistency, stating that the difference between winning probabilities in the grand contest and in the smaller contest should be identical across all participants in the smaller contest. This property overcomes some of the drawbacks of the widely-used ratio-form contest success functions. Our characterization shows that the criticisms commonly-held against difference-form contests success functions, such as lack of scale invariance and zero elasticity of augmentation, are unfounded. By clarifying the properties of this family of contest success functions, this axiomatization can help researchers to find the functional form better suited to their application of interest.

Keywords: contests; groups; contest success function; axioms (search for similar items in EconPapers)
JEL-codes: D31 D63 D72 D74 (search for similar items in EconPapers)
Pages: 28
Date: 2015-05
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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http://www.econ.ed.ac.uk/papers/id255_esedps.pdf

Related works:
Journal Article: An axiomatization of difference-form contest success functions (2016)
Working Paper: An axiomatization of difference-form contest success functions (2015)
Working Paper: An axiomatization of difference-form contest success functions (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:edn:esedps:255

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