Competing Openly or Blindly in Crowdsourcing Contests?

Organizations are increasingly outsourcing tasks once performed in-house to wider participants on the Internet by hosting online contests. In practice, two types of mechanisms are used to organize these contests: simultaneous (blind) and sequential (open). In a simultaneous contest, contestants submit their solutions independently without access to one another’s submissions, while in a sequential contest, contestants submit their solutions sequentially and each can view all prior submissions before making their decisions. Most prior theoretical and experimental research has focused on simultaneous contests, with only a handful that have studied sequential ones. In this paper, under the condition of incomplete information, we analytically show that simultaneous contests produce higher quality best solutions than sequential contests. Using a laboratory experiment, we test this theoretical prediction as well as the prediction that simultaneous contests are more efficient than sequential contests. Our data support both predictions. We also discover that as the number of contestants increases, the efficiency of sequential contests drops significantly, further reducing their performance relative to simultaneous contests.