DISCRIMINATION IN A MODEL OF CONTESTS WITH INCOMPLETE INFORMATION ABOUT ABILITY

• 成果类型: Article
• 署名作者: Perez-Castrillo, David; Wettstein, David
• 署名单位: Autonomous University of Barcelona; Barcelona School of Economics; Ben-Gurion University of the Negev
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12179
• 发表日期: 2016
• 页码: 881-914
• 关键词: All-pay auctions; asymmetric contests; head starts; allocation; handicaps; agents

摘要

We study contests with private information and identical contestants, where contestants' efforts and innate abilities generate output of varying qualities. The designer's revenue depends on the quality of the output, and she offers a reward to the contestant achieving the highest quality. We characterize the equilibrium behavior, outcomes, and payoffs for both nondiscriminatory and discriminatory (where the reward is contestant-dependent) contests. We derive conditions under which the designer obtains a larger payoff when using a discriminatory contest and describe settings, where these conditions are satisfied.