32 Pages Posted: 13 Jun 2016
Date Written: December 9, 2014
We examine how disclosure policy can be optimally designed to incentivize contestants when their participation is exogenously stochastic. In a generalized Tullock contest setting with two players who are asymmetric in both their values and entry probabilities, we fully characterize the necessary and sufficient conditions under which no disclosure dominates full disclosure. We find that the comparison depends solely on a balance effect exercised by entry probabilities on the expected total effort. The optimal disclosure policy must better balance the competition. These conditions continue to hold when the precision r of Tullock contests is endogenously chosen by the designer.
Suggested Citation: Suggested Citation
Fu, Qiang and Lu, Jingfeng and Zhang, Jun, Disclosure Policy in Tullock Contests with Asymmetric Stochastic Entry (December 9, 2014). Available at SSRN: https://ssrn.com/abstract=2793645 or http://dx.doi.org/10.2139/ssrn.2793645