Group Contests with Complementarities in Efforts

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Group Contests with Complementarities in Efforts AbstractUsually, groups increase their productivity by the specialization of their group members. In these cases, group output is no longer simply a sum of individual outputs. We analyze contests with group-specific public goods that allow for different degrees of complementarity between group members' efforts. More specifically, we use a Tullock contest success function and a CES-impact function. We show that in equilibrium the degree of complementarity is irrelevant if groups do not differ in size and group members have an identical valuation of the public good. The equilibrium is discontinuous as the CES function converges to the CobbDouglas case. Except for the effects at the discontinuity, higher complementarity tends to favor larger groups. In groups with diverse valuations, higher complementarity also leads to higher similarity in group members' efforts, which however is not necessarily an advantage for a more diverse group.JEL-Code: D74, H41.

Collective action problem in heterogeneous groups

“…They showed that if individual costs are specific nonlinear functions of individual efforts, then all group members contribute in proportion to their valuations and free-riding is reduced. Similar behaviour is predicted for the CES impact function [101,134]. In the case of weak-link contests, analysis predicts multiple equilibria including those with no free-riding at all [135].…”

Top Guns May Not Fire: Best-Shot Group Contests with Group-Specific Public Good Prizes

“…Kolmar and Rommeswinkel (2010) further study group contests employing a constant elasticity of substitution group impact function, which allows the impact function of a group to become a perfect-substitute type or a weakest-link type with different degree of complementarity accordingly to the elasticity of substitution of efforts within the group. In the current paper we study a group contest with a best-shot group impact function, where individual group members exert costly efforts simultaneously and independently, but only the highest effort within each group represents the group effort.…”