Asymmetric auctions and risk aversion within independent private values
Autor(a) principal: | |
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Data de Publicação: | 2007 |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Institucional do FGV (FGV Repositório Digital) |
Texto Completo: | http://hdl.handle.net/10438/16474 |
Resumo: | We study tournaments with many ex-ante asymmetric (heterogeneous) contestants as an independent-private-values all-pay auction. The asymmetry is either with respect to the distribution of valuations for the prize or the risk preferences. By characterizing equilibria in tnonotone strategies we show that tournaments \:vith man~y heterogenous contestants are qualitatively distinct. First, with two (or many ex-ante identical) participants, a contestant always exerts some effort with positive probability. In contrast, with many asymmetric participants, one 1night not exert any effort at all, even if there is a positive probability that he has the highest valuation among ali. Second, in tournan1ents with t'wo (o r n1any ex-ante h01nogenous) contestants, equilibrium effort densities are decreasing. This prediction is at odds with experimental evidence that shows the empírica! density might be increasing at high effort levels. V\.lith rnany heterogeneous contestants, however. the increasing bid density is consistent with an equilibrium behavior. |
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Parreiras, Sérgio O.Escolas::EPGE2016-05-05T13:11:25Z2016-05-05T13:11:25Z2007http://hdl.handle.net/10438/16474We study tournaments with many ex-ante asymmetric (heterogeneous) contestants as an independent-private-values all-pay auction. The asymmetry is either with respect to the distribution of valuations for the prize or the risk preferences. By characterizing equilibria in tnonotone strategies we show that tournaments \:vith man~y heterogenous contestants are qualitatively distinct. First, with two (or many ex-ante identical) participants, a contestant always exerts some effort with positive probability. In contrast, with many asymmetric participants, one 1night not exert any effort at all, even if there is a positive probability that he has the highest valuation among ali. Second, in tournan1ents with t'wo (o r n1any ex-ante h01nogenous) contestants, equilibrium effort densities are decreasing. This prediction is at odds with experimental evidence that shows the empírica! density might be increasing at high effort levels. V\.lith rnany heterogeneous contestants, however. the increasing bid density is consistent with an equilibrium behavior.engEscola de Pós-Graduação em Economia da FGVSeminários de pesquisa econômica da EPGE;TournamentsAsymmetric biddersAll-pay auctionsEconomiaLeilõesAsymmetric auctions and risk aversion within independent private valuesinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articlereponame:Repositório Institucional do FGV (FGV Repositório Digital)instname:Fundação Getulio Vargas (FGV)instacron:FGVinfo:eu-repo/semantics/openAccessORIGINALasymmetric.pdfasymmetric.pdfapplication/pdf767936https://repositorio.fgv.br/bitstreams/27f5c4c9-7e51-463d-a04e-ee7fbdc1687b/download90b9ddde7e85735daa6862c609a03d5cMD51LICENSElicense.txtlicense.txttext/plain; charset=utf-84707https://repositorio.fgv.br/bitstreams/a1f34d49-8aea-4ca9-8397-4f842df3b18a/downloaddfb340242cced38a6cca06c627998fa1MD52TEXTasymmetric.pdf.txtasymmetric.pdf.txtExtracted 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dc.title.eng.fl_str_mv |
Asymmetric auctions and risk aversion within independent private values |
title |
Asymmetric auctions and risk aversion within independent private values |
spellingShingle |
Asymmetric auctions and risk aversion within independent private values Parreiras, Sérgio O. Tournaments Asymmetric bidders All-pay auctions Economia Leilões |
title_short |
Asymmetric auctions and risk aversion within independent private values |
title_full |
Asymmetric auctions and risk aversion within independent private values |
title_fullStr |
Asymmetric auctions and risk aversion within independent private values |
title_full_unstemmed |
Asymmetric auctions and risk aversion within independent private values |
title_sort |
Asymmetric auctions and risk aversion within independent private values |
author |
Parreiras, Sérgio O. |
author_facet |
Parreiras, Sérgio O. |
author_role |
author |
dc.contributor.unidadefgv.por.fl_str_mv |
Escolas::EPGE |
dc.contributor.author.fl_str_mv |
Parreiras, Sérgio O. |
dc.subject.eng.fl_str_mv |
Tournaments |
topic |
Tournaments Asymmetric bidders All-pay auctions Economia Leilões |
dc.subject.por.fl_str_mv |
Asymmetric bidders All-pay auctions |
dc.subject.area.por.fl_str_mv |
Economia |
dc.subject.bibliodata.por.fl_str_mv |
Leilões |
description |
We study tournaments with many ex-ante asymmetric (heterogeneous) contestants as an independent-private-values all-pay auction. The asymmetry is either with respect to the distribution of valuations for the prize or the risk preferences. By characterizing equilibria in tnonotone strategies we show that tournaments \:vith man~y heterogenous contestants are qualitatively distinct. First, with two (or many ex-ante identical) participants, a contestant always exerts some effort with positive probability. In contrast, with many asymmetric participants, one 1night not exert any effort at all, even if there is a positive probability that he has the highest valuation among ali. Second, in tournan1ents with t'wo (o r n1any ex-ante h01nogenous) contestants, equilibrium effort densities are decreasing. This prediction is at odds with experimental evidence that shows the empírica! density might be increasing at high effort levels. V\.lith rnany heterogeneous contestants, however. the increasing bid density is consistent with an equilibrium behavior. |
publishDate |
2007 |
dc.date.issued.fl_str_mv |
2007 |
dc.date.accessioned.fl_str_mv |
2016-05-05T13:11:25Z |
dc.date.available.fl_str_mv |
2016-05-05T13:11:25Z |
dc.type.status.fl_str_mv |
info:eu-repo/semantics/publishedVersion |
dc.type.driver.fl_str_mv |
info:eu-repo/semantics/article |
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article |
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publishedVersion |
dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10438/16474 |
url |
http://hdl.handle.net/10438/16474 |
dc.language.iso.fl_str_mv |
eng |
language |
eng |
dc.relation.ispartofseries.por.fl_str_mv |
Seminários de pesquisa econômica da EPGE; |
dc.rights.driver.fl_str_mv |
info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
dc.publisher.none.fl_str_mv |
Escola de Pós-Graduação em Economia da FGV |
publisher.none.fl_str_mv |
Escola de Pós-Graduação em Economia da FGV |
dc.source.none.fl_str_mv |
reponame:Repositório Institucional do FGV (FGV Repositório Digital) instname:Fundação Getulio Vargas (FGV) instacron:FGV |
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Repositório Institucional do FGV (FGV Repositório Digital) |
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