Asymmetric Contests with Head Starts and Nonmonotonic Costs

Ron Siegel

doi:10.1257/mic.6.3.59

Asymmetric Contests with Head Starts and Nonmonotonic Costs

American Economic Journal Microeconomics ◽

10.1257/mic.6.3.59 ◽

2014 ◽

Vol 6 (3) ◽

pp. 59-105 ◽

Cited By ~ 25

Author(s):

Ron Siegel

Keyword(s):

Unique Equilibrium ◽

Technological Differences ◽

Dominated Strategies ◽

Asymmetric Contests ◽

All Pay Auction ◽

Strategic Effects

This paper studies multiprize contests in which players' costs need not be strictly increasing in their performance. Such costs accommodate various types of asymmetries, including head starts. Head starts capture incumbency advantages, prior investments, and technological differences. I provide an algorithm that constructs the unique equilibrium in which players do not choose weakly- dominated strategies, and apply it to study multiprize all-pay auctions with head starts. A comparison to the standard all-pay auction shows that the strategic effects of head starts differ substantially from those of differing valuations. (JEL D11, D44)

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A Multiregion Model with Capital Accumulation and Endogenous Amenities

Environment and Planning A Economy and Space ◽

10.1068/a38393 ◽

2007 ◽

Vol 39 (9) ◽

pp. 2248-2270 ◽

Cited By ~ 3

Author(s):

Wei-Bin Zhang

Keyword(s):

Capital Accumulation ◽

Comparative Statics ◽

The Other ◽

High Rate ◽

Unique Equilibrium ◽

Economic Activities ◽

Technological Differences ◽

National Output ◽

Simulation Results ◽

Wage Disparities

The author develops a multiregional growth model with endogenous amenity and capital accumulation for any number of regions. The simulation results demonstrate that the national dynamics have a unique equilibrium. Comparative statics analysis shows that, if environmental improvement occurs in the technologically advanced (less advanced) region, the national output rises (falls). As a region improves its technology, the other two regions' aggregated output levels fall—not only in relative, but also in absolute, terms. This implies that if any region has a high rate of technological change and the other regions remain technologically stationary, then economic activities will tend to be concentrated in the technologically advancing region. It is also shown that technological differences appear to play only a small role in accounting for spatial wage disparities and endowments.

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Asymmetric Contests with Conditional Investments

The American Economic Review ◽

10.1257/aer.100.5.2230 ◽

2010 ◽

Vol 100 (5) ◽

pp. 2230-2260 ◽

Cited By ~ 66

Author(s):

Ron Siegel

Keyword(s):

Labor Market ◽

Complete Information ◽

Unique Equilibrium ◽

Equilibrium Behavior ◽

Asymmetric Contests ◽

Special Case

This paper studies equilibrium behavior in a class of games that models asymmetric competitions with unconditional and conditional investments. Such competitions include lobbying settings, labor-market tournaments, and R&D races, among others. I provide an algorithm that constructs the unique equilibrium in these games and apply it to study competitions in which a fraction of each competitor's investment is sunk and the rest is paid only by the winners. Complete-information all-pay auctions are a special case. (JEL D44, D72, D82)

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