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Feedback in Tournaments under Commitment Problems: Experimental Evidence

Authors


  • The authors thank two anonymous referees, a coeditor as well as René Fahr, Matthias Kräkel, Johannes Münster, and Dirk Sliwka for helpful comments. The authors gratefully acknowledge financial support by the Deutsche Forschungsgemeinschaft (DFG) via SFB-TR 15 (Governance and the efficiency of economic systems) as well as research grant HA 4462/1-1 and HA 4462/1-2.

Abstract

We theoretically as well as experimentally analyze tournaments in which one of the agents leads over the other before entering the tournament, that is, in which one of the competitors benefits from a head start. The principal may decide upon informing the agents about the degree of this asymmetry. She cannot commit to giving feedback ex ante or not and, thus, chooses the strategy that is optimal for her ex post. In equilibrium, the principal reveals information if the asymmetry is not too large. Our experimental findings qualitatively confirm our theoretical prediction. Moreover, behavior of the principal and the agents is well aligned to each other.

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