Konrad, Kai A.; Kovenock, Dan
The lifeboat problem.
WZB Discussion Paper, SP II 2011-106
Volltext auf 'Open Access LMU' nicht verfügbar.
We study an all-pay contest with multiple identical prizes (“lifeboat seats”). Prizes are
partitioned into subsets of prizes (“lifeboats”). Players play a two-stage game. First, each
player chooses an element of the partition (“a lifeboat”). Then each player competes for a
prize in the subset chosen (“a seat”). We characterize and compare the subgame perfect
equilibria in which all players employ pure strategies or all players play identical mixed
strategies in the first stage. We find that the partitioning of prizes allows for coordination
failure among players when they play nondegenerate mixed strategies and this can
shelter rents and reduce rent dissipation compared to some of the less efficient pure