Discussion paper

DP15855 Optimal Sequential Contests

I study sequential contests where the efforts of earlier players may be disclosed to later players by nature or by design. The model has a range of applications, including rent seeking, R&D, oligopoly, public goods provision, and tragedy of the commons. I show that information about other players' efforts increases the total effort. Thus, the total effort is maximized with full transparency and minimized with no transparency. I also show that in addition to the first-mover advantage, there is an earlier-mover advantage. Finally, I derive the limits for large contests.

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Citation

Hinnosaar, T (2021), “DP15855 Optimal Sequential Contests”, CEPR Press Discussion Paper No. 15855. https://new.cepr.org/publications/dp15855