From Monopoly to Competition: Optimal Contests Prevail
Xiaotie Deng, Yotam Gafni, Ron Lavi, Tao Lin, Hongyi Ling
Abstract
We study competition among contests in a general model that allows for an arbitrary and heterogeneous space of contest design and symmetric contestants. The goal of the contest designers is to maximize the contestants' sum of efforts. Our main result shows that optimal contests in the monopolistic setting (i.e., those that maximize the sum of efforts in a model with a single contest) form an equilibrium in the model with competition among contests. Under a very natural assumption these contests are in fact dominant, and the equilibria that they form are unique. Moreover, equilibria with the optimal contests are Pareto-optimal even in cases where other equilibria emerge. In many natural cases, they also maximize the social welfare.
BibTeX
@article{Deng_Gafni_Lavi_Lin_Ling_2023, title={From Monopoly to Competition: Optimal Contests Prevail}, volume={37}, url={https://ojs.aaai.org/index.php/AAAI/article/view/25696}, DOI={10.1609/aaai.v37i5.25696}, abstractNote={We study competition among contests in a general model that allows for an arbitrary and heterogeneous space of contest design and symmetric contestants. The goal of the contest designers is to maximize the contestants’ sum of efforts. Our main result shows that optimal contests in the monopolistic setting (i.e., those that maximize the sum of efforts in a model with a single contest) form an equilibrium in the model with competition among contests. Under a very natural assumption these contests are in fact dominant, and the equilibria that they form are unique. Moreover, equilibria with the optimal contests are Pareto-optimal even in cases where other equilibria emerge. In many natural cases, they also maximize the social welfare.}, number={5}, journal={Proceedings of the AAAI Conference on Artificial Intelligence}, author={Deng, Xiaotie and Gafni, Yotam and Lavi, Ron and Lin, Tao and Ling, Hongyi}, year={2023}, month={Jun.}, pages={5608-5615} }