Contest functions: Theoretical foundations and issues in estimation

Jia, Hao; Skaperdas, Stergios; Vaidya, Samarth

doi:10.1016/j.ijindorg.2012.06.007

Cited by 110 publications

(69 citation statements)

References 89 publications

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“…Gar…nkel and Skaperdas (2007) and Konrad (2009) discuss the axiomatic foundations and economic illustrations for this special, but common, class of CSFs. Moreover, Jia (2008) shows that this contest function can also be motivated as the probability of winning a rank-order tournament (as in Lazear and Rosen, 1981), when the noise terms are drawn from the inverse exponential distribution (see also Jia et al, 2013). Under these conditions, the contests that we consider may therefore also be considered as rank-order tournaments.…”

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confidence: 95%

The power of money: Wealth effects in contests

Schroyen

Treich

2016

Games and Economic Behavior

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The relationship between wealth and power has long been debated. Nevertheless, this relationship has been rarely studied in a strategic game. In this paper, we study wealth e¤ects in a strategic contest game. We consider three types of contests which vary depending on whether rents and e¤orts are commensurable with wealth. Our theoretical analysis reveals that the e¤ects of wealth are strongly "contestdependent", and often depend on the sign of higher-order derivatives of the utility functions. It thus does not support general claims that the rich always lobby more or that low economic growth and wealth inequality spur con ‡icts.Keywords: Con ‡ict, contest, rent-seeking, wealth, risk aversion, lobbying, power, redistribution.JEL codes: C72, D72.We would like to thank Christian Gollier and Ragnar Torvik along with seminar participants at the universities of Gothenburg and Oslo, the Helsinki Center of Economic Research (HECER), the Luxembourg School of Finance, the Norwegian School of Economics (NHH) and the University of Queensland for their useful comments and suggestions. AbstractThe relationship between wealth and power has long been debated. Nevertheless, this relationship has been rarely studied in a strategic game. In this paper, we study wealth e¤ects in a strategic contest game. We consider three types of contests which vary depending on whether rents and e¤orts are commensurable with wealth. Our theoretical analysis reveals that the e¤ects of wealth are strongly "contestdependent", and often depend on the sign of higher-order derivatives of the utility functions. It thus does not support general claims that the rich always lobby more or that low economic growth and wealth inequality spur con ‡icts.

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confidence: 95%

The power of money: Wealth effects in contests

Schroyen

Treich

2016

Games and Economic Behavior

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“…Jia, Skaperdas, and Vaidya (2013) argue that the Tullock-contest success function is well motivated by an axiomatic foundation, by stochastic functional forms or by microfounded search models. Without the simple structure of the Tullock-contest success function the model studied in the paper at hand does not seem to be tractable.…”

Section: Introductionmentioning

confidence: 99%

Alliance Formation in Contests with Incomplete Information

Metzger¹

2015

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in

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“…One distinguished feature of 1 For excellent surveys of the contest literature see Corchón (2007) and Konrad (2009). 2 These characterizations fall into four main categories: Axiomatic, stochastic, optimally-designed and microfounded (Jia, Skaperdas and Vaidya, 2013). 3 For a detailed discussion of the econometric issues involved in the estimation of CSFs see Jia and Skaperdas (2011) and Jia et al (2013).…”

Section: Introductionmentioning

confidence: 99%

Difference-Form Group Contests

2014

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Contests are situations in which a set of agents compete for a valuable object, rent or award. The present paper analyzes difference-form group contests, that is, contests fought among groups and where their probability of victory depends on the difference of their effective efforts. First, we show that the non-existence of pure-strategy equilibria and the monopolization results obtained in previous analysis of difference-form contests rest critically on the assumption of a linear cost of effort. Under exponential costs, we show that pure strategy equilibria exist in a large set of cases and that more than one group can expend positive effort in equilibrium. Second, we show that inequality of valuations of victory within groups hinders their chances of prevailing in the contest. If possible; members may find beneficial to engage in progressive redistribution within their group.JEL Codes: D31, D63, D72, D74

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Contest functions: Theoretical foundations and issues in estimation

Cited by 110 publications

References 89 publications

The power of money: Wealth effects in contests

The power of money: Wealth effects in contests

Alliance Formation in Contests with Incomplete Information

Difference-Form Group Contests

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