Inequality and Competitive Effort: The Roles of Asymmetric Resources, Opportunity and Outcomes

Francesco Fallucchi, Abhijit Ramalingam
2017 Social Science Research Network  
We investigate how individuals react to different types of asymmetries in experimental twoplayer Tullock contests where contestants expend resources to win a prize. We compare the effects of three different sources of asymmetry: resources, abilities and possible outcomes. We find that overall competitive effort is greater in the presence of asymmetric abilities than other inequalities. Unlike other forms, asymmetry in abilities elicits a very aggressive reaction from disadvantaged players
more » ... taged players relative to their advantaged opponents. Moreover, despite similar average efforts, contestants with an advantage in ability mostly play a 'safe' strategy that secures a higher likelihood of winning the contest, while other advantaged players strategically adapt their efforts to those of their opponents. The Quantal Response Equilibrium (QRE) suggests that financial incentives are less salient in the presence of a biased contest procedure. JEL Codes: C91, C92, D31, D72
doi:10.2139/ssrn.3005250 fatcat:2mojmgd32rasrl46yl6ljmcudm