All-pay auctions with ties (Q2677732): Difference between revisions

In this article the authors study the two-player, complete information all-pay auction in which a tie ensues if neither player outbids the other by more than a given amount. More precisely, this paper extends the two-player, complete information all-pay auction by allowing a tie to occur when the difference in expenditures falls below a specified threshold.Under the assumption that winning is preferred to tying and that tying is preferred to losing, this paper completely characterizes the set of equilibrium for the entire parameter space of the margins and tie prizes. About convergence and the equilibrium manifold see Section 5. It is shown that, the discrete strategy space game creates qualitatively different incentives than the continuous strategy space version of the game.