Indefinitely Repeated Contests: An Experimental Study
57 Pages Posted: 25 Feb 2018 Last revised: 30 Mar 2020
Date Written: March 28, 2020
We experimentally explore indefinitely repeated contests. Theory predicts more cooperation, in the form of lower expenditures, in indefinitely repeated contests with a longer expected time horizon, and our data support this prediction, although the effect is moderated by experience. Theory also predicts more cooperation in indefinitely repeated contests compared to finitely repeated contests of the same expected length, but we find mixed support empirically. Finally, theory predicts no difference in cooperation across indefinitely repeated winner-take-all and proportional-prize contests, yet we find some evidence of less cooperation in the latter. Our paper extends the experimental literature on indefinitely repeated games to contests and, more generally, contributes to an infant empirical literature on behavior in indefinitely repeated games with "large" strategy spaces.
Keywords: contest, repeated game, cooperation, experiment
JEL Classification: C72, C73, C91, D72
Suggested Citation: Suggested Citation