An investment contest to influence environmental policy

In an investment contest for environmental policy, polluters and victims of pollution invest in an increase of their marginal benefits of pollution and environmental quality, respectively. These investments influence time-consistent environmental policy. Investments will exceed their optimal level. The more victims there are, the lower aggregate investment, the lower payoffs for the victims and the higher payoffs for the polluters. The more polluters there are, the higher aggregate investment and the lower payoffs for polluters and victims. Asymmetries between polluter and victim result in less overinvestment and bias environmental policy in favour of the less productive side.     

Whether to attack a terrorist's resource stock today or tomorrow

A terrorist defends an asset which grows from the first to the second period and is attacked. With large asset growth, the terrorist's first period outcome is low caused by a large attack. With no expenditure constraint, the terrorist's total outcome is positive. With equal attack and defense inefficiencies, when the terrorist as defender requires his first period outcome to be positive, the attacker eliminates the asset in the first period when asset growth multiplied with the square roots of the terrorist's and attacker's discount parameters exceed . This gives maximum conflict in the first period. Growth and the two discount parameters are strategic complements. The range for the attack inefficiency divided by defense inefficiency, which causes negative first period outcome for the terrorist, increases with asset growth. The attacker refrains from asset elimination in the first period due to strength (weakness) if the ratio is below (above) the range.     

Country image formation,stability, and change: a longitudinal assessment of consumers’ image of Azerbaijan

In 2012, Azerbaijan hosted the Eurovision Song Contest. For this emerging tourism-oriented country, the cultural mega-event represented a unique opportunity to present itself to a broad international public and construct a positive country image. The present longitudinal study explores how consumer images of Azerbaijan as a country were formed and changed as a result of the nation’s hosting of this event. By measuring the same respondents’ country image evaluations before and after the event, the present findings shed light on consumers’ processes of country-image formation and illuminate the event’s impact on Azerbaijan’s country image.     

Doping and cheating in contest-like situations

Individuals who compete in a contest-like situation (for example, in sports, in promotion tournaments, or in an appointment contest) may have an incentive to illegally utilize resources in order to improve their relative positions. We analyze such doping or cheating within a tournament game between two heterogeneous players. Besides the direct and indirect costs of doping, three major effects are identified which determine a player's decision to deviate from a no-doping situation — a cost effect, a likelihood effect and a base-salary effect. Moreover, the influence of heterogeneity and exogenous performance risk on a no-doping outcome, and the influence of ex-ante and ex-post doping tests on the players' investments are discussed.     

Altitude as handicap in rank-order football tournaments

The structure of professional sports allows us to document predictions from the theory of rank-order tournaments (Lazear and Rosen 1981). In the context of South American FIFA World Cup Qualifiers, under the presence of heterogeneous agents, handicapping the best quality players may increase the tournaments’ efficiency by making the contest more competitive. In particular, we show that playing in high-altitude stadiums (above 2500 m) constitutes a handicap as the otherwise least competitive teams benefit from the existence of an altitude advantage.     

Optimally biased Tullock contests

This paper examines optimally biased Tullock contests. We consider a multi-player Tullock contest in which players differ in their prize valuations. The designer is allowed to impose identity-dependent treatments – i.e., multiplicative biases – to vary their relative competitiveness. The literature has been limited, because a closed-form solution to the equilibrium is in general unavailable when the number of contestants exceeds two, which nullifies the usual implicit programming approach. We develop an algorithmic technique adapted from the general approach of Fu and Wu (2020) and obtain a closed-form solution to the optimum that addresses a broad array of design objectives. We further analyze a resource allocation problem in a research tournament and adapt Fu and Wu’s (2020) approach to this noncanonical setting. Our analysis paves the way for future research in this vein.     

The optimal entry fee-prize ratio in Tullock contests

We analyze a three-stage game where an organizer sets an entry fee for a Tullock contest event, and a finite population of homogeneous agents simultaneously decide whether to participate or not. We show that in the unique symmetric subgame perfect Nash equilibrium, the larger the population size, the lower the probability the agents enter the contest, but the organizer’s optimal entry fee-prize ratio could either increase or decrease with the population size. When the population size approaches infinity, the number of contestants converges to a Poisson distributed random variable.     

Total effort, competitive balance and the optimal contest success function

This paper shows that, in the constrained case, the value weighted contest success function (CSF) maximizes not only total effort, but every objective function which is increasing in total effort and competitive balance. In the unconstrained case, a first price all-pay auction with a reserve price is optimal only if the impact of competitive balance on the objective is small. Otherwise, a modified value weighted CSF is optimal.     

Sabotage in Corporate Contests – An Experimental Analysis

In corporate contests, employees compete for a prize. Ideally, contests induce employees to exert productive effort which increases their probability of winning. In many environments, however, employees can also improve their own ranking position by harming their colleagues. Such negative incentive effects of corporate contests are largely unexplored, which can partly be attributed to the fact that sabotaging behavior is almost unobservable in the field. In this study we analyze behavior in experimental contests with heterogeneous players who are able to mutually sabotage each other. We find that sabotaging behavior systematically varies with the composition of different types of contestants. Moreover, if the saboteur’s identity is revealed sabotage decreases while retaliation motives prevail. Our results promise to be valuable when designing corporate contests.     

Contests with multiple alternative prizes: Public-good/bad prizes and externalities

We study contests in which there are multiple alternative public-good/bad prizes, and the players compete, by expending irreversible effort, over which prize to have awarded to them. Each prize may be a public good for some players and a public bad for the others, and the players expend their effort simultaneously and independently. We first prove the existence of a pure-strategy Nash equilibrium of the game, then establish when the total effort level expended for each prize is unique across the Nash equilibria, and then summarize and highlight other interesting and important properties of the equilibria. Finally, we discuss the effects of heterogeneity of valuations on the players’ equilibrium effort levels and a possible extension of the model.