Asymmetric technologies in contests

Doron Klunover

Research output: Contribution to journalComment/debate

Abstract

I consider a contest between two risk-neutral players over a common-value prize, in which one player has a linear cost-of-effort function and the other a strictly convex cost-of-effort function f. I show that if the value of the prize is above (below) a certain threshold level, then the equilibrium aggregate effort in this contest is larger (smaller) than in a contest in which both players are characterized by the strictly convex cost-of-effort function f, and smaller (larger) than in a contest in which both players are characterized by a linear cost-of-effort function. Therefore, in contrast to the general result in the literature, asymmetry in contests can increase competition.

Original languageEnglish
Article number102337
JournalEuropean Journal of Political Economy
Volume78
DOIs
StatePublished - Jun 2023
Externally publishedYes

Keywords

  • Asymmetry
  • Contests
  • Technology

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