Contest Design with Threshold Objectives

Contest Design: An Experimental Investigation

This paper experimentally compares the performance of four simultaneous lottery contests: a grand contest, two multiple prize settings (equal and unequal prizes), and a contest which consists of two subcontests. Consistent with the theory, the grand contest generates the highest effort levels among all simultaneous contests. In multi-prize settings, equal prizes produce lower efforts than unequ...

Prize and Punishment: Optimal Contest Design with Incomplete Information∗

This paper studies the optimal contest design problem when the abilities of the risk neutral contestants are independent private information. The contest designer has a fixed prize budget to elicit efforts from the contestants. We consider all possible mechanisms that allocate prizes and punishments (negative prizes) across the contestants. We find that an optimal contest mechanism does not exi...

Social Loss Aversion and Optimal Contest Design

When designing a contest to motivate effort by salespeople, service employees, franchisees or product development teams, one of the key questions faced by managers is: What should be the optimal proportion of winners and losers? Prevailing marketing theory predicts that the proportion of winners in a contest should always be lower than the proportion of losers. Not only has this theory not been...

Contest Design with Uncertain Performance and Costly Participation

This paper studies the problem of designing contests for settings where a principal seeks to optimize the quality of the best contribution obtained, and potential contestants only strategize about whether to participate in the contest, as participation incurs some cost. This type of contest can be mapped to various real-life settings (e.g., selection of background actors based on headshots, pho...

Nios II Embedded Processor Design Contest