An axiomatization of difference-form contest success functions

Maria Cubel and Santiago Sánchez-Pagés

No 2015/5, Working Papers from Institut d'Economia de Barcelona (IEB)

Abstract: This paper presents an axiomatic characterization of difference-form group contests, that is, contests fought among groups and where their probability of victory depends on the difference of their effective efforts. This axiomatization rests on the property of Absolute Consistency, stating that the difference in winning probabilities between two contenders in the grand contest must be the same as when they engage in smaller contests. This property overcomes some of the drawbacks of the widely-used ratio-form contest success functions. Our characterization shows that the criticisms commonly-held against difference-form contests success functions, such as lack of scale invariance, are unfounded. Finally, we extend our axiomatization to relative-difference contests where winning probabilities depend on the difference of contenders effective efforts relative to total aggregate effort.

Keywords: Contests; groups; contest success function; axioms (search for similar items in EconPapers)
JEL-codes: D31 D63 D72 D74 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2015
New Economics Papers: this item is included in nep-mfd
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: An axiomatization of difference-form contest success functions (2016)
Working Paper: An axiomatization of difference-form contest success functions (2015)
Working Paper: An axiomatization of difference-form contest success functions (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:ieb:wpaper:2013/6/doc2015-5

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