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Title:Preemptive Behavior in Sequential-Move Tournaments with Heterogeneous Agents PDF Logo
Authors:Jost, Peter-Jürgen
Kräkel, Matthias
Issue Date:2004
Series/Report no.:Bonn econ discussion papers 2004,21
Abstract:Rank-order tournaments are usually modeled simultaneously. However, real tournaments are often sequential. We show that agents? strategic behavior in sequential-move tournaments significantly differ from the one in simultaneous-move tournaments: In a sequential-move tournament with heterogeneous agents, there may be either a first-mover or a second-mover advantage. Under certain conditions the first acting agent chooses a preemptively high effort so that the following agent gives up. The principal is able to prevent preemptive behavior in equilibrium, but he will not implement first-best efforts although the agents are risk neutral.
Subjects:preemption
tournaments
JEL:M5
M12
J3
Document Type:Working Paper
Appears in Collections:Bonn Econ Discussion Papers, Bonn Graduate School of Economics (BGSE), Universität Bonn

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