Endogenous technology choice in contests

We consider a lottery contest between n risk-neutral symmetric players, who compete for a prize with a common value. Prior to exerting effort, each player chooses between an old technology, in which return on effort is certain, and a new technology, in which return on effort is uncertain but on average is equal to the return on effort in the old technology. We characterize symmetric and asymmetric equilibria and show that in equilibrium the new technology is adopted by a proper subset of the players. The results offer an explanation for endogenous emergence of asymmetric technologies in contests.