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Unifying Contests: from Noisy Ranking to Ratio-Form Contest Success Functions

Author

Listed:
  • Fu, Qiang
  • Lu, Jingfeng
Abstract
This paper proposes a multi-winner noisy-ranking contest model. Contestants are ranked in a descending order by their perceived outputs, and rewarded by their ranks. A contestant's perceivable output increases with his/her autonomous effort, but is subject to random perturbation. We establish, under plausible conditions, the equivalence between our model and the family of (winner-take-all and multi-winner) lottery contests built upon ratio-form contest success functions. Our model thus provides a micro foundation for this family of often studied contests. In addition, our approach reveals a common thread that connects a broad class of seeming disparate competitive activities and unifies them in the nutshell of ratio-form success functions.

Suggested Citation

  • Fu, Qiang & Lu, Jingfeng, 2007. "Unifying Contests: from Noisy Ranking to Ratio-Form Contest Success Functions," MPRA Paper 6679, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:6679
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    References listed on IDEAS

    as
    1. Lazear, Edward P & Rosen, Sherwin, 1981. "Rank-Order Tournaments as Optimum Labor Contracts," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 841-864, October.
    2. Benny Moldovanu & Aner Sela, 2008. "The Optimal Allocation of Prizes in Contests," Springer Books, in: Roger D. Congleton & Arye L. Hillman & Kai A. Konrad (ed.), 40 Years of Research on Rent Seeking 1, pages 615-631, Springer.
    3. Benny Moldovanu & Aner Sela & Xianwen Shi, 2007. "Contests for Status," Journal of Political Economy, University of Chicago Press, vol. 115(2), pages 338-363.
    4. Szymanski, Stefan & Valletti, Tommaso M., 2005. "Incentive effects of second prizes," European Journal of Political Economy, Elsevier, vol. 21(2), pages 467-481, June.
    5. Stergios Skaperdas, 1996. "Contest success functions (*)," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 7(2), pages 283-290.
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    Citations

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    Cited by:

    1. Paul Schweinzer & Ella Segev, 2012. "The optimal prize structure of symmetric Tullock contests," Public Choice, Springer, vol. 153(1), pages 69-82, October.
    2. Balart, Pau & Chowdhury, Subhasish M. & Troumpounis, Orestis, 2017. "Linking individual and collective contests through noise level and sharing rules," Economics Letters, Elsevier, vol. 155(C), pages 126-130.
    3. Yildirim, Mustafa, 2023. "When does division matter? Revisiting the optimal contest architecture," Economics Letters, Elsevier, vol. 230(C).
    4. Giebe, Thomas, 2014. "Innovation contests with entry auction," Journal of Mathematical Economics, Elsevier, vol. 55(C), pages 165-176.
    5. Dmitry Ryvkin, 2013. "Heterogeneity of Players and Aggregate Effort in Contests," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 22(4), pages 728-743, December.
    6. Pradeep Dubey & Siddhartha Sahi, 2016. "Eliciting performance: deterministic versus proportional prizes," International Journal of Game Theory, Springer;Game Theory Society, vol. 45(1), pages 239-267, March.
    7. Fu, Qiang & Lu, Jingfeng, 2009. "The beauty of "bigness": On optimal design of multi-winner contests," Games and Economic Behavior, Elsevier, vol. 66(1), pages 146-161, May.

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    More about this item

    Keywords

    Multi-Winner Contest; Contest Success Function; Noisy Ranking;
    All these keywords.

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory

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