Productive versus destructive efforts in contests

• Published in: European Journal of Political Economy 2012-12, Vol.28 (4), p.461-468
• Main Author: Amegashie, J. Atsu
• Format: Article
• Language: English
• Subjects: Action theory; Behavior; Contest; Destructive effort; Game theory; Political economy; Production; Productive effort; Productivity concept; Sabotage; Threshold; Value
• ISSN: 0176-2680; 1873-5703
• DOI: 10.1016/j.ejpoleco.2012.05.005

We consider a two-stage contest in which players choose destructive efforts (sabotage) in stage 1 and productive efforts in stage 2. When the value of the prize is sufficiently high, we find that the productive effort of the contestants is independent of the value but their destructive effort is increasing in the value of the prize. The players only engage in destructive activities after productive effort reaches a threshold and do not increase their productive effort beyond this threshold. This result is consistent with contests in which participants increase effort in sabotage and dirty tricks more than on productive effort when the stakes are high (i.e., when the prize is high). After some point, destructive effort is more responsive than productive effort to increases in the value of the prize. Hence the ratio of destructive effort to productive effort increases with the value of the prize after the value exceeds a threshold. ► We consider a contest in which players choose destructive and productive efforts. ► Contestants invest in only productive effort if the value of the prize is low. ► Investment in destructive effort occurs only after productive effort reaches a threshold.