Sabotaging in contests with monitoring efforts

Abstract

This paper considers a 3-stage contest with both sabotage and monitoring efforts that aim to reduce sabotage. In the first stage, the regulator sets his monitoring efforts for each contestant. In the second stage, each contestant determines his sabotaging efforts, based on the monitoring efforts that were imposed by the regulator. In the third stage, each contestant determines his productive efforts in the contest. The results supply a justification to exert monitoring efforts because these efforts may benefit both the contestants and the regulator (a win-win situation). Furthermore, the paper defines the conditions where exerting monitoring efforts would be worthwhile.

Reimbursement as a tool to reduce sabotaging in rent‐seeking contests

“…One such form is the case where, in addition to standard rent‐seeking efforts, the contestants take action that might reduce the probability of others winning the contest, decrease other contestants' valuation of a prize, or increase the cost of other contestants' rent‐seeking effort. Efforts of this nature may be referred to as “sabotaging efforts” (for more details, see Amegashie, 2015; Chowdhury & Gürtler, 2015; or Minchuk at el., 2018). There are many real‐life examples of sabotaging, such as negative political campaign advertising or intentional fouls in sports.…”