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Contingent payments in selection contests
(Working paper; Arbeidsnotat, 2005-04)
The early literature on research contests stressed the advantages of a fixed
prize in inspiring R&D effort. More recently the focus has moved towards endogenizing
the rewards to research activity in these tournament settings, since this can induce extra
effort or enhance the surplus of the buyer. We focus on a research contest as a means of
selecting a partner for an R&D enterprise, in an ...
The all-pay auction with cross-shareholdings
(Working paper; Arbeidsnotat, 2007-02)
We consider an all-pay auction between several firms under asymmetric
information in which each firm owns a share in its rival. We characterize
the equilibrium and show how much these cross-shareholdings serve to
dampen competition. Additionally, we explain why the well known relationship
between the equilibrium strategies of the standard first price and
all-pay auctions breaks down in our setting.
Rational benevolence in small committees
(Working paper; Arbeidsnotat, 2006-09)
We consider a pie-splitting game involving three committee members. In response to
the large literature on sequential procedures in this type of game, we propose an
institution that is inspired by auction theory. The (sealed) bids of the players are
proposals for a distribution of the pie and are given simultaneously. If any of the bids
is preferred to all others in a pairwise comparison (i.e. ...