All - Pay
نویسندگان
چکیده
The paper studies a new class of games, “All-Pay Contests”, which capture general asymmetries and sunk investments inherent in scenarios such as lobbying, competition for market power, labor-market tournaments, and R&D races. Players compete for one of several identical prizes by choosing a score. Conditional on winning or losing, it is weakly better to do so with a lower score. The generality of this formulation allows for differing production technologies, costs of capital, prior investments, conditional and unconditional investments, and attitudes towards risk, among others. I provide a closed-form formula for players’ equilibrium payoffs, and use it to compute aggregate expenditures, derive the effects of changes in contest structure, and analyze player participation. An algorithm for computing the unique equilibrium is given for a subclass of contests. This subclass nests multi-prize, complete-information all-pay
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