Numerical Modelling of Two-Prize Asymmetric Contests
|Author:||Mgr. Ludmila Matysková|
|Year:||2013 - summer|
|Leaders:|| doc. PhDr. Martin Gregor Ph.D.
|Work type:|| Economic Theory
|Awards and prizes:||M.A. with distinction from the Dean of the Faculty of Social Sciences for an excellent state-final examination performance and for an extraordinarily good masters diploma thesis.|
|Abstract:||This thesis presents an analysis on a class of asymmetric imperfectly discriminating
multi-prize contests with the aim to investigate when more than one
prize becomes optimal prize allocation if the average effort is to be maximized.
We present n-person model with heterogeneous contestants who compete for
two, possibly different, prizes. The contestants may differ in their relative abilities,
i.e., parameters affecting their probabilities to win either of the prizes.
Two different numerical methods for finding pure strategy Nash equilibria are
employed. Depending on particular distributions of the abilities, we find two
possible scenarios when the second prize becomes optimal. Furthermore, we address
an issue of existence and uniqueness of a pure strategy Nash equilibrium
with respect to the returns to scale in effort parameter.