Voluntary Disclosure in Asymmetric Contests

• 成果类型: Article
• 署名作者: Ewerhart, Christian; Lareida, Julia
• 署名单位: University of Zurich; University of Zurich
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdae001
• 发表日期: 2024
• 页码: 3402-3422
• 关键词: rent-seeking contests; All-pay auctions; Information revelation; incomplete information; Tullock contests; persuasion; EXISTENCE; POLICY; aggregation; equilibrium

摘要

This article studies the incentives for interim voluntary disclosure of verifiable information in probabilistic all-pay contests with two-sided incomplete information. Private information may concern marginal cost, valuations, and ability. Our main result says that, if the contest is uniformly asymmetric, then full revelation is the unique perfect Bayesian equilibrium outcome. This is so because the weakest type of the underdog reveals her type in an attempt to moderate the favourite, while the strongest type of the favourite tries to discourage the underdog-so that the contest unravels. This strong-form disclosure principle is robust with respect to correlation, partitional evidence, randomized disclosures, sequential moves, and continuous type spaces. Moreover, the assumption of uniform asymmetry is not needed when incomplete information is one-sided. However, the principle may break down when type distributions are too similar, contestants possess commitment power, or information is unverifiable. In fact, cheap talk will always be ignored, even if mediated by a trustworthy third party.