Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/190794
Authors: 
Arve, Malin
Chiappinelli, Olga
Year of Publication: 
2018
Series/Report no.: 
DIW Discussion Papers 1777
Abstract: 
Motivated by the EU concept of Pre-Commercial Procurement and the massivepresence of SMEs in the European economy, we study how budget constraints affect R&D effort in sequential elimination tournaments. We show that introducingbudget constraints leads to a non-monotonicity in unconstrained contestants' effort.Furthermore, we show that if the budget asymmetry is not too large, unconstrainedcontestants exert higher effort than when faced with unconstrained contestants only.
Subjects: 
Pre-Commercial Procurement
Contests
Budget constraints
JEL: 
D72
H57
Document Type: 
Working Paper
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