Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/122033
Authors: 
Boleslavsky, Raphael
Cotton, Christopher
Year of Publication: 
2015
Series/Report no.: 
Queen's Economics Department Working Paper 1343
Abstract: 
An organization must decide which proposals to fund. In evaluating the proposals, the organization may rely on those applying for funding to produce evidence about the merits of their own proposals. We consider the role of a capacity constraint preventing the organization from funding all projects. Agents produce more (Blackwell) informative evidence about the merits of their proposals when there are capacity constraints. In a two agent model, we fully characterize the equilibrium under unlimited and limited capacity. Unless the prior strongly favors accepting both proposals, the funding organization is better off when its capacity is limited.
Subjects: 
strategic search
evidence production
persuasion
lobbying
all-pay auction
Bayesian persuasion
JEL: 
D72
D78
D83
L15
Document Type: 
Working Paper

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