Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/311830 
Year of Publication: 
2025
Series/Report no.: 
BERG Working Paper Series No. 201
Publisher: 
Bamberg University, Bamberg Economic Research Group (BERG), Bamberg
Abstract: 
We conduct a laboratory experiment to compare the fairness and intensity of round-robin tournaments with three symmetric players, a single prize, and two alternative match formats. Matches are either organized as lottery contests or all-pay auctions. Whereas we confirm the theoretical prediction that tournaments are less fair if matches are organized as all-pay auctions, we reject the predicted difference in tournament intensity. Moreover, the reason for the reduced fairness of tournaments based on all-pay auctions is also at odds with theory. In the lab, such tournaments heavily disfavor (in payoff-terms) the player acting in the final two matches. The reason is the substantially weaker than predicted discouragement of this player when competing first against the loser of the first match. Subjects try to exploit a perceived negative psychological momentum in such situations but only manage to end up in a dissipation trap: an effort-intense, final-like last match which significantly reduces their payoffs.
Subjects: 
Sequential Round-Robin Tournament
Lottery Contest
All-Pay Auction
Laboratory Experiment
Discouragement Effect
Dissipation Trap
JEL: 
C72
C91
D72
Z20
ISBN: 
978-3-949224-22-5
Document Type: 
Working Paper

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