ALL-PAY AUCTION EQUILIBRIA IN CONTESTS

Jose Alcalde and Matthias Dahm

Working Papers. Serie AD from Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie)

Abstract: We analyze (non-deterministic) contests with anonymous contest success functions. There is no restriction on the number of contestants or on their valuations for the prize. We provide intuitive and easily verifiable conditions for the existence of an equilibrium with properties similar to the one of the (deterministic) all-pay auction. Since these conditions are fulfilled for a wide array of situations, the predictions of this equilibrium are very robust to the specific details of the contest. An application of this result contributes to fill a gap in the analysis of the popular Tullock rent- seeking game because it characterizes properties of an equilibrium for increasing returns to scale larger than two, for any number of contestants and in contests with or without a common value.

Keywords: (non-) deterministic contest; all-pay auction; contest success functions. (search for similar items in EconPapers)
JEL-codes: C72 D44 D72 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2007-12
New Economics Papers: this item is included in nep-gth
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:ivi:wpasad:2007-27

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