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Bonn Econ Discussion Papers, Bonn Graduate School of Economics (BGSE), Universität Bonn >
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http://hdl.handle.net/10419/22898
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| Title: | | Preemptive Behavior in Sequential-Move Tournaments with Heterogeneous Agents  |
| 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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