Single- and Double-Elimination All-Pay Tournaments
38 Pages Posted: 26 Jun 2014 Last revised: 3 Jun 2015
Date Written: April 9, 2015
Tournaments consisting of iterative matches are a common mechanism for determining how to allocate a prize. For this reason it is important to understand the behavioral as well as the theoretical properties of different tournament structures. Given that laboratory experiments have consistently found high levels of overbidding in contests, one might suspect that double-elimination tournaments would generate substantially more total investment than single-elimination tournaments despite the two types of tournaments generating theoretically equivalent expected aggregate investment. This paper reports a set of laboratory experiments designed to test this comparison. The results indicate that aggregate investment is similar between the two tournaments, despite behavioral differences in bidding strategies.
Keywords: All-pay auctions, tournaments, experiments
JEL Classification: C7, C9, D4, D7
Suggested Citation: Suggested Citation