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Bribing in Team Contests

Author

Listed:
  • Serhat Dogan
  • Emin Karagözoglu
  • Kerim Keskin
  • Cagri Saglam

Abstract

We study bribing in a sequential team contest with multiple pairwise battles. We allow for asymmetries in winning prizes and marginal costs of effort; and we characterize the conditions under which (i) a player in a team is offered a bribe by the owner of the other team and (ii) she accepts the bribe. We show that these conditions depend on the ratios of players’ winning prizes and marginal costs of effort: the team owner chooses to bribe the player with the most favorable winning prize to marginal cost of effort ratio, and offer a bribe that leaves her indifferent between accepting (and exerting zero effort) and not accepting (and exerting her optimal effort). In some cases, the competition between players and the negative consequences of one player receiving a bribe on the team performance can drag down equilibrium bribe to zero. We also study the impact of changes in winning prizes and marginal costs of effort on equilibrium bribing behavior.

Suggested Citation

  • Serhat Dogan & Emin Karagözoglu & Kerim Keskin & Cagri Saglam, 2020. "Bribing in Team Contests," CESifo Working Paper Series 8096, CESifo.
    • Handle: RePEc:ces:ceswps:_8096
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    References listed on IDEAS

    as
    1. Kimbrough, Erik O. & Sheremeta, Roman M., 2013. "Side-payments and the costs of conflict," International Journal of Industrial Organization, Elsevier, vol. 31(3), pages 278-286.
    2. Eso, Peter & Schummer, James, 2004. "Bribing and signaling in second price auctions," Games and Economic Behavior, Elsevier, vol. 47(2), pages 299-324, May.
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    5. Qiang Fu & Jingfeng Lu & Yue Pan, 2015. "Team Contests with Multiple Pairwise Battles," American Economic Review, American Economic Association, vol. 105(7), pages 2120-2140, July.
    6. Subhasish Chowdhury & Oliver Gürtler, 2015. "Sabotage in contests: a survey," Public Choice, Springer, vol. 164(1), pages 135-155, July.
    7. Rachmilevitch, Shiran, 2013. "Bribing in first-price auctions," Games and Economic Behavior, Elsevier, vol. 77(1), pages 214-228.
    8. Rachmilevitch, Shiran, 2015. "Bribing in second-price auctions," Games and Economic Behavior, Elsevier, vol. 92(C), pages 191-205.
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    More about this item

    Keywords

    bribing; contest games; pairwise battles; team contests;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions

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