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Tullock Brings Perseverance and Suspense to Tug-of-War

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  • Emin Karagözoglu
  • Cagri Saglam
  • Agah R. Turan

Abstract

We model the dynamic contest between two players as a game of tug-of-war with a Tullock contest success function (CSF). We show that (pure strategy) Markov perfect equilibrium of this game exists, and it is unique. In this equilibrium - in stark contrast to a model of tug-of-war with an all pay auction CSF - players exert positive efforts until the very last battle. Since the outcome of an individual battle is determined stochastically, even disadvantaged players who fell behind will occasionally win battles and hence the advantage likely change hands. We deliver a set of empirically appealing results on effort dynamics.

Suggested Citation

  • Emin Karagözoglu & Cagri Saglam & Agah R. Turan, 2020. "Tullock Brings Perseverance and Suspense to Tug-of-War," CESifo Working Paper Series 8103, CESifo.
    • Handle: RePEc:ces:ceswps:_8103
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    References listed on IDEAS

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    4. Michael R. Baye & Dan Kovenock & Casper G. Vries, 1996. "The all-pay auction with complete information," Springer Books, in: Roger D. Congleton & Arye L. Hillman & Kai A. Konrad (ed.), 40 Years of Research on Rent Seeking 1, pages 209-223, Springer.
    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. Konrad, Kai A. & Kovenock, Dan, 2005. "Equilibrium and Efficiency in the Tug-Of-War," Purdue University Economics Working Papers 1177, Purdue University, Department of Economics.
    7. Doğan, Serhat & Karagözoğlu, Emin & Keskin, Kerim & Sağlam, Çağrı, 2018. "Multi-player race," Journal of Economic Behavior & Organization, Elsevier, vol. 149(C), pages 123-136.
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    Cited by:

    1. Karagözoğlu, Emin & Sağlam, Çağrı & Turan, Agah R., 2021. "Perseverance and suspense in tug-of-war," Journal of Mathematical Economics, Elsevier, vol. 95(C).

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    More about this item

    Keywords

    contests; discouragement effect; perseverance; stochastic games; tug-of-war; Tullock contest success function;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions

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