Cita:
Einy, E., Moreno, D. and Shitovitz, B. (2017). The value of public information in common-value Tullock contests. Economic Theory, v. 63, n. 4, pp. 925-942.
Agradecimientos:
Einy acknowledges financial support of the Israel Science Foundation, grant 648/2. Moreno acknowledges financial support from the Ministerio de Ciencia e Innovación, grant ECO2011-29762
Consider a symmetric common-value Tullock contest with incomplete information in which the players' cost of effort is the product of a random variable and a deterministic real function of effort, d. We show that the Arrow&-Pratt curvature of d, Rd,Rd, deterConsider a symmetric common-value Tullock contest with incomplete information in which the players' cost of effort is the product of a random variable and a deterministic real function of effort, d. We show that the Arrow&-Pratt curvature of d, Rd,Rd, determines
the effect on equilibrium efforts and payoffs of the increased
flexibility/reduced commitment that more information introduces into the
contest: If RdRd is increasing, then effort decreases (increases) with
the level of information when the cost of effort (value) is independent
of the state of nature. Moreover, if RdRd is increasing (decreasing),
then the value of public information is nonnegative (nonpositive).[+][-]
