The Generalized War of Attrition.
We generalize the War of Attrition model to allow for N + K firms competing for N prizes. Two special cases are of particular interest. First, if firms continue to pay their full costs after dropping out (as in a standard-setting context), each firm's exit time is independent both of K and of t...
| Main Authors: | , |
|---|---|
| Format: | Working paper |
| Language: | English |
| Published: |
National Bureau of Economic Research
1997
|
| _version_ | 1797080263304413184 |
|---|---|
| author | Bulow, J Klemperer, P |
| author_facet | Bulow, J Klemperer, P |
| author_sort | Bulow, J |
| collection | OXFORD |
| description | We generalize the War of Attrition model to allow for N + K firms competing for N prizes. Two special cases are of particular interest. First, if firms continue to pay their full costs after dropping out (as in a standard-setting context), each firm's exit time is independent both of K and of the actions of other players. Second, in the limit in which firms pay no costs after dropping out (as in a natural-oligopoly problem), the field is immediately reduced to N + 1 firms. Furthermore, we have perfect sorting, so it is always the K 1 lowest-value players who drop out in zero time, even though each player's value is private information to the player. We apply our model to politics, explaining the length of time it takes to collect a winning coalition to pass a bill. |
| first_indexed | 2024-03-07T00:57:31Z |
| format | Working paper |
| id | oxford-uuid:8896ec7d-72f6-467a-b348-7c06371e0084 |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-07T00:57:31Z |
| publishDate | 1997 |
| publisher | National Bureau of Economic Research |
| record_format | dspace |
| spelling | oxford-uuid:8896ec7d-72f6-467a-b348-7c06371e00842022-03-26T22:18:21ZThe Generalized War of Attrition.Working paperhttp://purl.org/coar/resource_type/c_8042uuid:8896ec7d-72f6-467a-b348-7c06371e0084EnglishDepartment of Economics - ePrintsNational Bureau of Economic Research1997Bulow, JKlemperer, PWe generalize the War of Attrition model to allow for N + K firms competing for N prizes. Two special cases are of particular interest. First, if firms continue to pay their full costs after dropping out (as in a standard-setting context), each firm's exit time is independent both of K and of the actions of other players. Second, in the limit in which firms pay no costs after dropping out (as in a natural-oligopoly problem), the field is immediately reduced to N + 1 firms. Furthermore, we have perfect sorting, so it is always the K 1 lowest-value players who drop out in zero time, even though each player's value is private information to the player. We apply our model to politics, explaining the length of time it takes to collect a winning coalition to pass a bill. |
| spellingShingle | Bulow, J Klemperer, P The Generalized War of Attrition. |
| title | The Generalized War of Attrition. |
| title_full | The Generalized War of Attrition. |
| title_fullStr | The Generalized War of Attrition. |
| title_full_unstemmed | The Generalized War of Attrition. |
| title_short | The Generalized War of Attrition. |
| title_sort | generalized war of attrition |
| work_keys_str_mv | AT bulowj thegeneralizedwarofattrition AT klempererp thegeneralizedwarofattrition AT bulowj generalizedwarofattrition AT klempererp generalizedwarofattrition |