Parallel Contests

A problem of Parallel Contests is raised and modeled. The equilibria in final situations of parallel contests are analyzed and characterized and the behaviours of contestants with different abilities’ parameters are explained. Given that the values of the prizes in the two contests are different, in equilibrium a group of strong players prefer entering into the contest with a higher prize. However, except the group of stronger ones, in equilibrium others will enter into both contests because they obtain equal expected revenue from the two contests, though these weak ones do not have equal probabilities to enter into the two parallel contests. Under the condition of rationalizability, this paper characterizes the respective distributions of contestants’ abilities in the two parallel contests, proves the existence of the equilibrium in parallel contests and completes the analysis of the parallel contests from the perspective of contestants.Parallel contests, Contest, Strategic behaviours

Evolution in Symmetric Incomplete Information Games

The paper compares two models of evolution in symmetric two-player games with incomplete information. One model postulates that the type of a player is fixed, and evolution works within types. In the other model type-contingent strategies evolve. In the case of two types and two strategies it is shown that the stability properties of stationary states are the same under the two dynamics when payoffs do not depend on the type of the other player, but may differ when they do.incomplete information games, evolution, stability

Three Sequential Cases: from Symmetry to Asymmetry

Three critical cases, involving asymmetric and symmetric cases, in the sequential stages of the n-player repeated auctions are analyzed and compared. These cases might arise in a process of sequential, identical or equivalent auctions, where the auction result may reveal information about the strength or competitiveness of the participants. The behaviours of different players are characterized. Generally a player bids more aggressively when facing a strong player rather than a weak player. However a player favours competing with a weak one rather than a strong one. By applying the concept of Conditional Stochastic Dominance, revenues of players and the seller between the three stages are compared. It is proved that in this sequential process the information structure of the auctions changes and the seller’s revenue increases. Finally, this n-player asymmetric auction model can also be used to compare the revenues between high-bid and open auctions and especially the results first derived by Maskin and Riley (2000) in two-player case are proved to be valid in the n-player case.Asymmetric auction; Revenue comparison

Non-linear pricing in oligopoly

Price discrimination is an extensively studied subject in monopoly behavior. Increasing profits, covering fixed cost and reducing distortions are reasons to sell a homogenous good at different prices. Price discrimination is however present also in oligopolistic markets. This paper is going to analyze similarities and differences with respect to the literature on monopoly pricing on second degree price discrimination. It is shown that also oligopolies allow even for second degree price discrimination an in this case tend to increase supply even beyond the socially efficient quantity. Facing heterogenous customers competition leads to substantial differences with respect to the determination of the optimal sales plan

No Crowding Out despite Kickbacks: Competition between Gatekeeping GPs

In health service markets, patients often rely on the advice of their general practitioner (GP) to decide which treatment best fits their needs. Hospitals, in turn, influence GPs referral decisions through kickbacks. We formulate a model with competitive heterogeneous GPs who differ in the degree to which they internalize the disutility that their patients suffer from inappropriate treatments. We prove that a separable equilibrium with referring and not referring GPs exist

Labor demand for senior employees in the context of early retirement

With respect to the labor market participation of the elderly in welfare states, the economic literature focuses on the incentives to the worker in the light of generous early retirement opportunities. The sociological literature on the other hand addresses the problem of low productivity of elderly in the context of occupational disability and workplace design. The economic link between supply and demand is hardly taken into account. This paper focuses on the labor demand for elderly in the context of necessary speci c investment. According to this paper, due to better perspectives on the labor market following a decrease of the incentives to retire early, e.g. by a raise in the average e ective retirement age, need not necessarily harm the elderly people. The paper thus helps to close the gap in the evaluation of pension reforms

Commitment Problems and War in International Bargaining

In the context of international bargaining, standard models predict that a shift in military power can cause preventive war because it changes the relative bargaining position between states. We find that shifts in military power are not the only cause of war under commitment problems and that commitment problems per se are not necessarily a cause of war even if the relative bargaining position changes substantially.Plötzliche und substantielle Verlagerungen der militärischen Stärke zwischen Staaten gelten in der relevanten Literatur als mögliche Ursache von Präventionskriegen. Formal betrachtet kann eine Verlagerung der militärischen Stärke zu einer Veränderung der relativen Verhandlungsposition führen. Dies bedeutet, dass ein militärisch schwächer werdender Staat befürchten muss, in zukünftigen Verhandlungen mit einem militärisch stärker werdenden Staat, ein schlechteres Verhandlungsergebnis zu erzielen. Wenn der stärker werdende Staat nicht glaubhaft versichern kann, seine Stärke nicht zu nutzen, um in Zukunft ein besseres Ergebnis zu erreichen, kann es aus Sicht des schwächer werdenden Staates rational sein, durch sofortigen Krieg, seine gegenwärtige Stärke auszunutzen, um ein Ergebnis herbeizuführen, das in Zukunft durch Verhandlung nicht mehr möglich ist. Wir erweitern das in der Literatur etablierte Verhandlungsmodell und zeigen, dass eine plötzliche und substantielle Verlagerung der militärischen Stärke nicht der einzige Grund ist, warum es zu einem Präventionskrieg kommen kann. Zudem untersuchen wir weitere Gründe, die zu einer veränderten Verhandlungsposition führen können und finden heraus, dass selbst eine deutliche Verschiebung der relativen Verhandlungsposition im Gleichgewicht nicht notwendigerweise Krieg zur Folge hat