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Journal of Economic Theory and Econometrics
Journal of the Korean Econometric Society
On the Optimal Allocation of Prizes in Contests
Vol.25, No.1, March 2014, 1–12
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Kiho Yoon
(Department of Economics, Korea University)
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Abstract
We characterize the optimal structure of prizes in contests, when the contest designer is interested in the maximization of either the expected total effort or the expected highest effort. The all-pay auction framework in the present paper makes it possible to derive most of the results in Moldovanu and Sela's (2001, American Economic Review, 542-558; 2006, Journal of Economic Theory, 70-96) incomplete-information model of contests in a particularly simple fashion, as well as to obtain new results.
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Keywords
Contests, Optimal structure, Prizes, All-pay auctions |
JEL classification codes
D44, J31, D72, D82 |
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