Article
Licensed
Unlicensed
Requires Authentication
Comparative Statics and Welfare in Heterogeneous All-Pay Auctions: Bribes, Caps, and Performance Thresholds
-
Rene Kirkegaard
Published/Copyright:
September 10, 2008
Comparative statics for all-pay auctions with two heterogeneous and privately informed bidders are analyzed. General results are provided for when one bidder becomes stochastically weaker. The comparative statics are fully characterized for truncations. Moreover, we show that expected revenue may increase when one bidder weakens. In the second part of the paper we consider a dynamic contest in which beliefs change endogenously: the first bidder may preempt the auction by paying a bribe. An all-pay auction is held if the bribe is not paid, in which case the second bidder revises his beliefs. With the option to bribe, expected payoff decreases for a set of types of at least one bidder, possibly the bidder ostensibly advantaged by the preemption option. However, the expected revenue and the ex ante payoff of both bidders may improve.
Published Online: 2008-9-10
©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston
You are currently not able to access this content.
You are currently not able to access this content.
Articles in the same Issue
- Topics Article
- When Stackelberg and Cournot Equilibria Coincide
- Conflict and Consensus: A Theory of Control in Organisations
- Backward Integrated Information Gatekeepers and Independent Divisions in the Product Market
- Identification of Individual Demands from Market Data under Uncertainty
- On the Role of Uncertainty in the Risk-Incentives Tradeoff
- Time-to-Build and the Inverse U-Shape Investment-Uncertainty Relationship
- Revisiting Independence and Stochastic Dominance for Compound Lotteries
- On Competitive Equilibria with Asymmetric Information
- A Duopoly Location Toolkit: Consumer Densities Which Yield Unique Spatial Duopoly Equilibria
- Purchasing Power Parity with Strategic Markets
- Global vs. Local Information in (Anti-)Coordination Problems with Imitators
- Costly Evidence Production and the Limits of Verifiability
- Research Joint Ventures, Optimal Licensing, and the R&D Subsidy Policy
- Comparative Statics and Welfare in Heterogeneous All-Pay Auctions: Bribes, Caps, and Performance Thresholds
- Ex Post Private Information and Monopolistic Screening
- Passing the Buck in Sequential Negotiation
- Bidding Strategies for Simultaneous Ascending Auctions
- The Dirty Face Problem with Unawareness
- Cost Pass-Through under Delegation
- Contributions Article
- Empirical Implications of Information Structure in Finite Extensive Form Games
- Counter Marginalization of Information Rents: Implementing Negatively Correlated Compensation Schemes for Colluding Parties
- Forgiving-Proof Equilibrium in Infinitely Repeated Games
- A Categorical Model of Cognition and Biased Decision Making
- Mechanism Design with Moderate Evidence Cost
- Connectivity and Allocation Rule in a Directed Network
- Competing for Recognition through Public Good Provision
- Principal-Agent Problems with Exit Options
- Herd Behavior and Contagion in Financial Markets
- A Constructive Proof that Learning in Repeated Games Leads to Nash Equilibria
- Advances Article
- The Full Surplus Extraction Theorem with Hidden Actions
Articles in the same Issue
- Topics Article
- When Stackelberg and Cournot Equilibria Coincide
- Conflict and Consensus: A Theory of Control in Organisations
- Backward Integrated Information Gatekeepers and Independent Divisions in the Product Market
- Identification of Individual Demands from Market Data under Uncertainty
- On the Role of Uncertainty in the Risk-Incentives Tradeoff
- Time-to-Build and the Inverse U-Shape Investment-Uncertainty Relationship
- Revisiting Independence and Stochastic Dominance for Compound Lotteries
- On Competitive Equilibria with Asymmetric Information
- A Duopoly Location Toolkit: Consumer Densities Which Yield Unique Spatial Duopoly Equilibria
- Purchasing Power Parity with Strategic Markets
- Global vs. Local Information in (Anti-)Coordination Problems with Imitators
- Costly Evidence Production and the Limits of Verifiability
- Research Joint Ventures, Optimal Licensing, and the R&D Subsidy Policy
- Comparative Statics and Welfare in Heterogeneous All-Pay Auctions: Bribes, Caps, and Performance Thresholds
- Ex Post Private Information and Monopolistic Screening
- Passing the Buck in Sequential Negotiation
- Bidding Strategies for Simultaneous Ascending Auctions
- The Dirty Face Problem with Unawareness
- Cost Pass-Through under Delegation
- Contributions Article
- Empirical Implications of Information Structure in Finite Extensive Form Games
- Counter Marginalization of Information Rents: Implementing Negatively Correlated Compensation Schemes for Colluding Parties
- Forgiving-Proof Equilibrium in Infinitely Repeated Games
- A Categorical Model of Cognition and Biased Decision Making
- Mechanism Design with Moderate Evidence Cost
- Connectivity and Allocation Rule in a Directed Network
- Competing for Recognition through Public Good Provision
- Principal-Agent Problems with Exit Options
- Herd Behavior and Contagion in Financial Markets
- A Constructive Proof that Learning in Repeated Games Leads to Nash Equilibria
- Advances Article
- The Full Surplus Extraction Theorem with Hidden Actions
