EconPapers    
Economics at your fingertips  
 

Investment Behaviour in a Two Period Contest Model

Martin Grossmann and Helmut Dietl

No 69, Working Papers from University of Zurich, Institute for Strategy and Business Economics (ISU)

Abstract: This paper presents a two-period model of talent investments where two clubs compete with respect to a contest prize. We show that two qualitatively different types of equilibria are possible using a closed-loop approach with strictly convex costs: The large market club invests in both periods more than the small market club or the small market club invests in both periods more than the large market club. In case of an open-loop approach with strictly convex costs, however, the large market club always invests more. The open-loop and closed-loop equilibria coincide if costs are linear.

Keywords: contest; open-loop and closed-loop equilibrium; sports leagues (search for similar items in EconPapers)
JEL-codes: D92 L13 L83 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2007-09
New Economics Papers: this item is included in nep-mic and nep-spo
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://repec.business.uzh.ch/RePEc/iso/ISU_WPS/69_ISU_full.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found

Related works:
Journal Article: Investment Behaviour in a Two-Period Contest Model (2009) Downloads
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:iso:wpaper:0069

Access Statistics for this paper

More papers in Working Papers from University of Zurich, Institute for Strategy and Business Economics (ISU) Contact information at EDIRC.
Bibliographic data for series maintained by IBW IT ().

 
Page updated 2024-04-22
Handle: RePEc:iso:wpaper:0069