On optimal head starts in all-pay auctions

C. Seel, C. Wasser

Research output: Contribution to journalArticleAcademicpeer-review

2 Citations (Scopus)

Abstract

We consider a two-player all-pay auction with symmetric independent private values that are uniformly distributed. The designer chooses the size of a head start that is given to one of the players. The designer's objective is to maximize a convex combination of the expected highest effort and the expected aggregate effort. Unless the weight on the highest effort is one, small head starts are always worse than no head start. Moreover, the optimal head start is strictly positive if and only if the weight on the highest effort is large enough.
Original languageEnglish
Pages (from-to)211-214
Number of pages4
JournalEconomics Letters
Volume124
Issue number2
DOIs
Publication statusPublished - Aug 2014

Keywords

  • Contest
  • All-pay auction
  • Head start
  • CONTESTS

Cite this