Stochastic-Share Contests

14 Pages Posted: 25 Jul 2022 Last revised: 7 Oct 2022

See all articles by Philip Brookins

Philip Brookins

University of South Carolina

Andrew Smyth

Boise State University - Department of Economics

Date Written: October 6, 2022


This paper proposes the Stochastic-Share Contest, a novel contest format that combines the Winner-Take-All Contest and the Proportional-Prize Contest, with the former nesting the latter two as special cases. Motivated by the experimental contest literature, we include risk aversion and a "joy of winning" in our model and show that Stochastic-Share Contests induce optimal investment when both are present. Intuitively, the Stochastic-Share format achieves this result by harnessing the excitement of the Winner-Take-All format and the security of the Proportional-Prize setting. Among the many applications of Stochastic-Share Contests, we illustrate their utility for contest experiments, "winner-take-all markets," design competitions, employee reward programs, and patenting.

Keywords: contest, winner-take-all, proportional-prize, risk aversion, joy of winning

JEL Classification: C72, D72, C90, D40, D82

Suggested Citation

Brookins, Philip and Smyth, Andrew, Stochastic-Share Contests (October 6, 2022). Available at SSRN: or

Philip Brookins

University of South Carolina ( email )

Department of Economics
1014 Greene St
Columbia, SC 29208
United States
8037773603 (Phone)


Andrew Smyth (Contact Author)

Boise State University - Department of Economics ( email )

United States

Do you have negative results from your research you’d like to share?

Paper statistics

Abstract Views
PlumX Metrics