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Mis-judging merit: the effects of adjudication errors in contests
Published online by Cambridge University Press: 14 March 2025
Abstract
Within contests, adjudication errors imply at the same time the exclusion of a meritorious candidate and the inclusion of a non-meritorious one. We study theoretically how adjudication errors affect bids in all-pay auctions, by disentangling the respective effects of exclusion and inclusion errors, and showing how they interact with the framing of incentives (prize or penalty) under different assumptions on preferences. We test our theoretical predictions with an experiment where we manipulate the presence of exclusion errors, inclusion errors, and the framing of incentives. The experimental evidence indicates that errors of either exclusion or inclusion significantly decrease bids in all-pay auctions relative to a setting without errors, interacting negatively, with no significant difference in the size of their effects. Bid levels are significantly higher in a penalty framing relative to a prize framing, both in the absence of errors and in the presence of adjudication errors.
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- Copyright © The Author(s), under exclusive licence to Economic Science Association 2022.
Footnotes
Supplementary Information The online version contains supplementary material available at https://doi.org/10.1007/s10683-022-09785-4.
The replication material for the study is available at https://doi.org/10.3886/E182901V3.