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On Elimination in Contests: A Perspective on Output Maximization
Author(s) -
Jiao Qian
Publication year - 2013
Publication title -
pacific economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.34
H-Index - 33
eISSN - 1468-0106
pISSN - 1361-374X
DOI - 10.1111/1468-0106.12018
Subject(s) - maximization , contest , economics , concave function , productivity , production (economics) , monotonic function , mathematical economics , perspective (graphical) , utility maximization , function (biology) , regular polygon , microeconomics , econometrics , computer science , mathematics , macroeconomics , biology , mathematical analysis , geometry , artificial intelligence , evolutionary biology , political science , law
This paper investigates the desirability of adding a preliminary elimination stage for output maximization in a winner‐take‐all contest framework in which the contestant who achieves the highest (random) output wins. We find that, generally, the desirability of an elimination stage does not monotonically depend on the productivity of the effort; adding a preliminary stage can improve output for both concave and convex production functions. This result contrasts sharply with current insight from effort maximization, which argues that adding a preliminary stage can increase effort supply only if the production function is concave.