Coordinating on Who Dopes: An All Pay Auction Approach to Model Doping in Sport

This chapter explores whether the equilibrium effects of noisy behavior can cause large deviations from standard predictions in economically relevant situations. It considers a simple price-competition game, which is also partly motivated by the possibility of changing a payoff parameter that has no effect on the unique Nash equilibrium, but which may be expected to affect quantal response equilibrium. In the minimum-effort coordination game studied, any common effort in the range of feasible effort levels is a Nash equilibrium, but one would expect that an increase in the cost of individual effort or an increase in the number of players who are trying to coordinate would reduce the effort levels observed in an experiment. The chapter presents an analysis of the logit equilibrium and rent dissipation for a rent-seeking contest that is modeled as an “all-pay auction.” The final two applications in this chapter deal with auctions with private information.

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The Third Place Game

Journal of Sports Economics ◽

10.1177/1527002519859415 ◽

2019 ◽

Vol 21 (1) ◽

pp. 64-86

Author(s):

Netanel Nissim ◽

Aner Sela

Keyword(s):

Common Knowledge ◽

The Other ◽

Third Place ◽

Second Stage ◽

The Third ◽

Other Hand ◽

Strong Player ◽

All Pay Auction ◽

Total Effort

We study an elimination tournament with four contestants, each of whom has either a high value of winning (a strong player) or a low value of winning (a weak player) and these values are common knowledge. Each pairwise match is modeled as an all-pay auction. The winners of the first stage (semifinal) compete in the second stage (final) for the first prize, while the losers of the first stage compete for the third prize. We examine whether or not the game for the third prize is profitable for the designer who wishes to maximize the total effort of the players. We demonstrate that if the players are asymmetric and there are at least two strong players, then there is always a seeding of the players such that the third place game is not profitable. On the other hand, if there are at least two weak players, then there is always a seeding of the players such that the third place game is profitable.

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The Effect of Competition on Risk Taking in Contests

Games ◽

10.3390/g9030072 ◽

2018 ◽

Vol 9 (3) ◽

pp. 72 ◽

Cited By ~ 1

Author(s):

Lorenzo Spadoni ◽

Jan Potters

Keyword(s):

Risk Taking ◽

Interaction Effect ◽

Significant Interaction ◽

Significant Interaction Effect ◽

All Pay Auction ◽

Level Of Risk

We investigate, theoretically and experimentally, the effect of competition on risk taking in a contest in which players only decide on the level of risk they wish to take. Taking more risk implies a chance of a higher performance, but also implies a higher chance of failure. We vary the level of competition in two ways: by varying the number of players (2 players versus 8 players), and by varying the sensitivity of the contest to differences in performance (lottery contest versus all-pay auction). Our results show that there is a significant interaction effect between the two treatments, suggesting that players are particularly prone to take more risks if both the number of players and the sensitivity to performance are higher.

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The Max-Min Group Contest: Weakest-link (Group) All-Pay Auction

Southern Economic Journal ◽

10.1002/soej.12129 ◽

2016 ◽

Vol 83 (1) ◽

pp. 105-125 ◽

Cited By ~ 18

Author(s):

Subhasish M. Chowdhury ◽

Dongryul Lee ◽

Iryna Topolyan

Keyword(s):

Link Group ◽

Weakest Link ◽

Group Contest ◽

All Pay Auction

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