A tug-of-war team contest

• 成果类型: Article
• 署名作者: Haefner, Samuel
• 署名单位: University of Basel
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/j.geb.2017.04.013
• 发表日期: 2017
• 页码: 372-391
• 关键词: Team contests; Multi-stage contests; Tug-of-war; all-pay auction; Absorbing Markov chain

摘要

This paper analyzes a tug-of-war contest between two teams. In each round of the tug-of-war, a pair of agents from the opposing teams competes in a private value all-pay auction with asymmetric value distributions and effort effectiveness. Whichever team arrives first at a given lead in terms of battle victories over the opponent wins the tug-of-war. There exists a unique Markov-perfect equilibrium in bidding strategies which depend on the respective player's valuation and the current state of the tug-of-war. We derive rich comparative statics for this equilibrium by using the fact that the state of the tug-of-war evolves according to a time-homogeneous absorbing Markov chain. (C) 2017 Elsevier Inc. All rights reserved.