We analyze the subgame perfect equilibrium of the round-robin tournament with one strong (dominant) and two weak players, and we compare this tournament and the one-stage contest with respect to the players' expected payoffs, expected total effort, and their probabilities of winning. We find that if the contest designer's goal is to maximize the players' expected total effort, then – if the asymmetry between the players is relatively low – the one-stage contest should be used. However, if the asymmetry is relatively high, then the round-robin tournament should be used.
|Number of pages||34|
|Journal||Scandinavian Journal of Economics|
|State||Published - 1 Oct 2017|
- All-pay auctions
- multistage contests
ASJC Scopus subject areas
- Economics and Econometrics