Collective contests with externalities

Lee, Sanghack; Kang, Jae Hyeong

doi:10.1016/s0176-2680(98)00034-2

Cited by 31 publications

(27 citation statements)

References 18 publications

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“…A simple linear version of the Chung (1996) Similarly, the two-player versions of other contests by Farmer and Pecorino (1998), Lee and Kang (1998), Amegashie (1999), Glazer and Konrad (1999), Garfinkel and Skaperdas (2000), Grossman and Mendoza (2001), and Matros and Armanios (2009) can be obtained from our generalized contest by placing appropriate parameter restrictions.…”

Section: Contests With Spilloversmentioning

confidence: 99%

“…Cohen and Sela (2005) restrict the winning payoff to show that in certain contests a weaker contestant can win with higher probability than a stronger contestant. Many other studies use modified payoffs in the Tullock contest, a short list of example includes Chung (1996), Alexeev and Leitzel (1996), Lee and Kang (1998), Amegashie (1999), Glazer and Konrad (1999), Garfinkel and Skaperdas (2000), Grossman and Mendoza (2001), Öncüler and Croson (2005), and Matros and Armanios (2009).…”

Section: Introductionmentioning

confidence: 99%

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A Generalized Tullock Contest

Sheremeta

Chowdhury

2010

SSRN Journal

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We construct a generalized Tullock contest under complete information where contingent upon winning or losing, the payoff of a player is a linear function of prizes, own effort, and the effort of the rival. This structure nests a number of existing contests in the literature and can be used to analyze new types of contests. We characterize the unique symmetric equilibrium and show that small parameter modifications may lead to substantially different types of contests and hence different equilibrium effort levels.JEL Classifications: C72, D72, D74

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Section: Contests With Spilloversmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

A Generalized Tullock Contest

Sheremeta

Chowdhury

2010

SSRN Journal

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“…Chung (1996) and Kaplan et al (2002) examine contests with effort-dependent prizes. Lee and Kang (1998) and Baye et al (2005) study contests with rank-order spillovers. Although these contests are intuitively and structurally very different, they often share common links.…”

Section: Introductionmentioning

confidence: 99%

Strategically equivalent contests

Chowdhury

Sheremeta

2014

Theory Decis

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Using a two-player Tullock-type contest, we show that intuitively and structurally different contests can be strategically equivalent. Strategically equivalent contests generate the same best response functions and, as a result, the same equilibrium efforts. However, strategically equivalent contests may yield different equilibrium payoffs. We propose a simple two-step procedure to identify strategically equivalent contests. Using this procedure, we identify contests that are strategically equivalent to the original Tullock contest, and provide new examples of strategically equivalent contests. Finally, we discuss possible contest design applications and avenues for future theoretical and empirical research.

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“…First, the paper is naturally related to the large literature on individual rent-seeking contests initiated by Tullock (1980) and further developed by e.g. Dixit (1987), Leininger (1993, Baik (1994), Konrad (2000), Lee (2000), Baye & Hoppe (2003) or Morgan (2003). Second, the paper is closely related to a relatively small, but growing literature making contest models the core of a theory of the …rm.…”

Section: Introductionmentioning

confidence: 99%

Haggling for Rents, Relational Contracts, and the Theory of the Firm

Gürtler

2010

Schmalenbach Bus Rev

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In this paper, a formal rent-seeking theory of the …rm is developed. The main idea is that integration (compared to non-integration) facilitates rentseeking for the integrating party, but makes it harder for the integrated one. In a one-period model, this implies that the rent-seeking contest becomes more uneven and the parties rent-seek less. Here, integration is optimal. In the in…nitely-repeated version of the model, it is also possible for the parties to enter a relational contract, under which each promises not to engage in rent-seeking. Such a contract must be self-enforcing, for it cannot be enforced by court. It is shown that integration makes the relational contract less easily sustainable, as, due to its cost advantage, the integrating party gains more from deviating than any party under non-integration. Hence, integration is preferred, if relational contracts are not sustainable, while, otherwise, nonintegration may well be preferred. Moreover, it is shown that the model's predictions are in line with many empirical facts on the choice of ownership structures.

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Collective contests with externalities

Cited by 31 publications

References 18 publications

A Generalized Tullock Contest

A Generalized Tullock Contest

Strategically equivalent contests

Haggling for Rents, Relational Contracts, and the Theory of the Firm

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