Effort Levels in Contests with Two Asymmetric Players

• DOI: 10.2307/1059984
• Publication Date: 2006-04-22T08:59:31Z
• Authors: Kyung Hwan Baik
• Keywords: 0502 economics and business; 05 social sciences

A contest is a situation in which players compete with one another by expending effort to win prize. Examples abound. Firms spending RD 26], Krueger [14], Posner [20], Rogerson [23], Appelbaum and Katz [1], Hillman Riley [12], Hirshleifer [13], Ellingsen [8], Nitzan [18], Baik [2; 3] have studied rent-seeking contests. Lazear Rosen [15], O'Keeffe, Viscusi, Zeckhauser [19], [24] examined performance incentives associated reward schemes. [22] has analyzed the war of attrition auctions. Dixit [7] considered strategic commitments contests different applications. These are only part literature on theory Despite vast literature, however, effects asymmetries between not been clarified, except Harris Vickers [11] who analyze, patent race model, consequences asymmetries. The purpose this paper examine two individual total levels model logit-form probability-of-winning function. Effort expended deserve attention. interpreted as social costs thus level measure economic efficiency; an R&D expenditures determine expected date invention. We focus resulting from their valuations prize, abilities convert into probability winning, or both. Such common For example, people locations may receive