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Sequential competitions with a middle-mover advantage

Kendall, R; (2021) Sequential competitions with a middle-mover advantage. Journal of Behavioral and Experimental Economics , 91 , Article 101667. 10.1016/j.socec.2021.101667.

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Abstract

This paper investigates the incentives that drive advantageous positions in sequential competitions. Sequential competitions have been shown to have either a first- or last-mover advantage. In contrast, this paper illustrates a general sequential-move competition where the first- and last-moving agents are the least profitable while the middle-moving agent is guaranteed to earn the highest possible payoff. This result provide for a new intuition about the underlying incentives in a sequential decision structure which are tested using a multiple-round laboratory experiment. Experimental data aggregated across all rounds support the prediction of a first- and last-mover disadvantage along with a middle-mover advantage. Furthermore, the data suggest that subjects learn as they gain experience with this competition. In this manner, a sequential decision structure with inexperienced agents will benefit the first- and middle-moving agents, whereas the same decision structure with experienced agents will only benefit the middle-moving agents.

Type: Article
Title: Sequential competitions with a middle-mover advantage
DOI: 10.1016/j.socec.2021.101667
Publisher version: https://doi.org/10.1016/j.socec.2021.101667
Language: English
Additional information: This version is the author accepted manuscript. For information on re-use, please refer to the publisher's terms and conditions.
UCL classification: UCL
UCL > Provost and Vice Provost Offices
UCL > Provost and Vice Provost Offices > UCL SLASH
UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of S&HS
UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of S&HS > Dept of Economics
URI: https://discovery.ucl.ac.uk/id/eprint/10128601
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