Difference-form contest success functions and effort levels in contests

Foundations for contest success functions

“…The …rst two consider the case of two contestants and build on the idea that only di¤erences in e¤ort should matter -an idea introduced by Hirshleifer in (4). Baik (1998) proposed the following form, given a positive scalar ,…”

“…3 However, our …rst approach is related to other works. Assume that e¤orts are a noisy predictor of performance in the contest.…”

“…Skaperdas also axiomatized the logit model (4). 3 Anbarci, Skaperdas and Syropoulos (2002) present a model in which a two party con ‡ict over a resource can either be settled through bargaining over the resource or through a contest. The contest de…nes the disagreement point of the bargaining problem to which three di¤erent bargaining solutions are applied.…”

The theory of contests: a survey

“…The first two consider the case of two contestants and build on the idea that only differences in effort matter. Baik (1998) These CSF are problematic because the winning probabilities depend on the units in which expenditures are measured (e.g., dollars or cents), see our discussion of property (H) later in this section. Alcalde and Dahm (2007) proposed the following CSF that circumvents this difficulty; Given a positive scalar α, suppose for simplicity that G j ≥ G j+1 .…”

“…In Corchón (2000) it is shown that this property holds in more general models. See Gradstein (1995), Baik (1998), Nti (1999) and Fang (2002) for further study of comparative statics when contest success functions are not symmetric.…”