Asymmetric Contests with Conditional Investments
American Economic Review · 2010 · Volume 100 · Issue 5
Abstract
This paper studies equilibrium behavior in a class of games that models asymmetric competitions with unconditional and conditional investments. Such competitions include lobbying settings, labor-market tournaments, and R& races, among others. I provide an algorithm that constructs the unique equilibrium in these games and apply it to study competitions in which a fraction of each competitor's investment is sunk and the rest is paid only by the winners. Complete-information all-pay auctions are a special case. (JEL D44, D72, D82)
Keywords
Auctions, Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior, Asymmetric and Private Information
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