DP14598 Assortative Matching Contests

Author(s): Aner Sela
Publication Date: April 2020
Keyword(s): Tullock contest, Two-sided matching
JEL(s): D44, D72, D82, J31
Programme Areas: Industrial Organization
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=14598

We study two-sided matching contests with two sets, A and B, each of which includes a finite number of heterogeneous agents with commonly known types. The agents in each set compete in Tullock contests where they simultaneously send their costly efforts, and then are assortatively matched, namely, the winner of set A is matched with the winner of set B and so on until all the agents in the set with the smaller number of agents are matched. We analyze the agents' equilibrium efforts for which an agent's match-value is either a multiplicative or an additive function of the types who are matched. We demonstrate that whether or not both sets have the same number of agents might have a critical effect on their equilibrium efforts. In particular, a little change in the size of one of the sets might have a radical effect on the agents' equilibrium efforts.