Winners' Efforts in Team Contests

30 Pages Posted: 21 Feb 2019

See all articles by Stefano Barbieri

Stefano Barbieri

Tulane University - Department of Economics

Marco Serena

Max Planck Institute for Tax Law and Public Finance

Date Written: January 17, 2019

Abstract

The conventional wisdom for individualistic dynamic contests is that expected total effort is larger in a simultaneous than in a sequential contest, as only the latter is affected by the "discouragement" effect. In contrast, all temporal structures of team contests yield the same expected total effort, as shown by Fu, Lu, and Pan (2015)'s remarkable neutrality result. Rather than expected total effort, we analyze the consequences of different temporal structures of team contests on expected winners' efforts, a natural objective in a number of applications such as R&D races, elections, and sports. We show that, among all possible temporal structures, expected winners' efforts are maximized by a fully simultaneous and minimized by a fully sequential contest. This result thus parallels the conventional wisdom for individualistic contests. And the neutrality of expected total effort ceases to hold as soon as winners' and losers' efforts are not equally valuable.

Keywords: team contest, winners' efforts, temporal structures

JEL Classification: C72, D72, D74, D82

Suggested Citation

Barbieri, Stefano and Serena, Marco, Winners' Efforts in Team Contests (January 17, 2019). Working Paper of the Max Planck Institute for Tax Law and Public Finance No. 2019-03. Available at SSRN: https://ssrn.com/abstract=3338359

Stefano Barbieri

Tulane University - Department of Economics ( email )

New Orleans, LA 70118
United States

Marco Serena (Contact Author)

Max Planck Institute for Tax Law and Public Finance ( email )

Marstallplatz 1
Munich, 80539
Germany

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