Existence of a Unique Equilibrium in Asymmetric Contests with Interdependent Preferences
International Journal of Economic Behavior and Organization
Volume 3, Issue 2-1, April 2015, Pages: 10-14
Received: Dec. 7, 2014; Accepted: Dec. 15, 2014; Published: Dec. 27, 2014
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Author
Shumei Hirai, Department of Economics, Seinan Gakuin University, Fukuoka, Japan
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Abstract
By relaxing the common assumption of purely self-interested preferences in contests, we study contests in which players care not only about their own material payoffs but also about other players’ payoffs, a scenario we term “interdependent preferences.” In addition, we identify three possible types of heterogeneity among players in contests. First, players may have asymmetric preferences toward each other. Second, players may have various abilities to convert expenditures to productive efforts. Third, players may face various financial constraints. This paper presents a proof of the existence and uniqueness of a pure Nash equilibrium in asymmetric contests with interdependent preferences.
Keywords
Contests, Interdependent Preferences, Existence and Uniqueness
To cite this article
Shumei Hirai, Existence of a Unique Equilibrium in Asymmetric Contests with Interdependent Preferences, International Journal of Economic Behavior and Organization. Special Issue: Recent Developments of Economic Theory and Its Applications. Vol. 3, No. 2-1, 2015, pp. 10-14. doi: 10.11648/j.ijebo.s.2015030201.13
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