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Player strength and effort in contests
Linnaeus University, School of Business and Economics, Department of Economics and Statistics (NS).ORCID iD: 0000-0002-8973-1410
University of Cologne, Germany.
2024 (English)Report (Other academic)
Abstract [en]

In competitive settings, disparities in player strength are common. It is intuitively unclear whether a stronger player would opt for larger or smaller effort compared to weaker players. Larger effort could leverage their strength, while lowereffort might be justified by their higher probability of winning regardless of effort.We analyze contests with three or more players, exploring when stronger players exert larger or lower effort. To rank efforts, it suffices to compare marginal utilities insituations where efforts are equal. Effort ranking depends on differences in hazardrates (which are smaller for stronger players) and reversed hazard rates (which arelarger for stronger players). Compared to weaker players, stronger players chooselarger effort in winner-takes-all contests and lower effort in loser-gets-nothing contests. Effort rankings can be non-monotonic in contests with several identical prizes,and they depend on the slopes of players’ pdfs in contests with linear prize structure.

Place, publisher, year, edition, pages
Universität Bonn;Universität zu Köln , 2024. , p. 31
Series
ECONtribute Discussion Paper series ; 285
National Category
Economics and Business
Research subject
Economy
Identifiers
URN: urn:nbn:se:lnu:diva-132606OAI: oai:DiVA.org:lnu-132606DiVA, id: diva2:1898508
Available from: 2024-09-17 Created: 2024-09-17 Last updated: 2024-09-17Bibliographically approved

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Giebe, Thomas

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CiteExportLink to record
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