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Stockholm School of Economics SSE Working Paper Series in Economics, Stockholm School of Economics

No 2017:2:
Self-Allocation in Contests

Axel Bernergård () and Karl Wärneryd ()

Abstract: We consider contestants who must choose exactly one contest, out of several, to participate in. We show that when the contest technology is of a certain type, or when the number of contestants is large, a self-allocation equilibrium, i.e., one where no contestant would wish to change his choice of contest, results in the allocation of players to contests that maximizes aggregate equilibrium effort. For a class of oligopoly models that are equivalent to contests, this implies output maximization.

Keywords: Contests; self-allocation; effort maximization; quantity competition.; (follow links to similar papers)

JEL-Codes: C72; D43; D44; D72; D74; L13; (follow links to similar papers)

20 pages, August 27, 2017

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