Diversification and information in contests

Lemus, J; Temnyalov, E

Diversification and information in contests

Lemus, J Temnyalov, E

Permalink

Publisher:: SPRINGER
Publication Type:: Journal Article
Citation:: ECONOMIC THEORY

Open Access

Copyright Clearance Process

Recently Added
In Progress
Open Access

This item is open access.

Adobe PDF

Download Published versionAdobe PDF (1.41 MB)

View on publisher's site

View statistics

Full metadata record

Field	Value	Language
dc.contributor.author	Lemus, J
dc.contributor.author	Temnyalov, E https://orcid.org/0000-0002-1077-8196
dc.date.accessioned	2024-01-15T14:13:15Z
dc.date.available	2024-01-15T14:13:15Z
dc.identifier.citation	ECONOMIC THEORY
dc.identifier.issn	0938-2259
dc.identifier.issn	1432-0479
dc.identifier.uri	http://hdl.handle.net/10453/174502
dc.description.abstract	<jats:title>Abstract</jats:title><jats:p>We study contests with technological uncertainty, where contestants can invest in different technologies of uncertain value. The principal, who is also uncertain about the value of the technologies, can disclose an informative yet noisy public signal about the merit of each technology. The signal can focus contestants’ investments into more promising technologies or increase diversification. We characterize the principal’s optimal disclosure of information about the technologies, which depends on the value of diversification, the informativeness of available signals, and the ex-ante beliefs of the likelihood of success for each technology. We also find that under some conditions offering larger prizes or having more contestants decreases the extent of information disclosure.</jats:p>
dc.language	English
dc.publisher	SPRINGER
dc.relation	http://purl.org/au-research/grants/arc/DE200100590
dc.relation.ispartof	ECONOMIC THEORY
dc.relation.isbasedon	10.1007/s00199-023-01532-x
dc.rights	info:eu-repo/semantics/openAccess
dc.subject	1401 Economic Theory, 1402 Applied Economics, 1403 Econometrics
dc.subject.classification	Economic Theory
dc.subject.classification	3502 Banking, finance and investment
dc.subject.classification	3801 Applied economics
dc.subject.classification	3803 Economic theory
dc.title	Diversification and information in contests
dc.type	Journal Article
utslib.for	1401 Economic Theory
utslib.for	1402 Applied Economics
utslib.for	1403 Econometrics
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Business
pubs.organisational-group	/University of Technology Sydney/Faculty of Business/Economics Discipline
utslib.copyright.status	open_access	*
dc.date.updated	2024-01-15T14:12:38Z
pubs.publication-status	Published online

Abstract:

AbstractWe study contests with technological uncertainty, where contestants can invest in different technologies of uncertain value. The principal, who is also uncertain about the value of the technologies, can disclose an informative yet noisy public signal about the merit of each technology. The signal can focus contestants’ investments into more promising technologies or increase diversification. We characterize the principal’s optimal disclosure of information about the technologies, which depends on the value of diversification, the informativeness of available signals, and the ex-ante beliefs of the likelihood of success for each technology. We also find that under some conditions offering larger prizes or having more contestants decreases the extent of information disclosure.

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10453/174502