DP5132 Contests with Ties

Author(s):	Daniel Cohen, Aner Sela
Publication Date:	July 2005
Keyword(s):	all-pay auctions, contests
JEL(s):	D44, D72
Programme Areas:	Industrial Organization
Link to this Page:	cepr.org/active/publications/discussion_papers/dp.php?dpno=5132

We study all-pay contests in which there is a positive probability of a tied outcome. We analyse both one-stage contests and multi-stage contests with tie-breaks. We demonstrate that in symmetric two-player contests, the designer does not have an incentive to award a prize in a case of a tie. Consequently, in symmetric multi-stage two-player contests, the designer should allow an unlimited number of tie-breaks until a winner is decided.