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Indefinitely repeated contests with incumbency advantage

Published online by Cambridge University Press:  01 January 2025

Cary Deck ,
Zachary Dorobiala Open the ORCID record for Zachary Dorobiala [Opens in a new window]  and
Paan Jindapon
Cary Deck
Affiliation:
Department of Economics, Finance, and Legal Studies, The University of Alabama, Tuscaloosa, AL 35487, USA
Zachary Dorobiala*
Affiliation:
Department of Economics, Finance, and Legal Studies, The University of Alabama, Tuscaloosa, AL 35487, USA
Paan Jindapon
Affiliation:
Department of Economics, Finance, and Legal Studies, The University of Alabama, Tuscaloosa, AL 35487, USA
*
zdorobiala@crimson.ua.edu
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Abstract

We study an indefinitely repeated Tullock contest in which the stage-game winner gains an incumbency advantage in the next stage-game. The incumbent's advantage allows the incumbent to carry over a proportion of their expenditure in the previous contest to the next contest. Theoretically, this advantage is not predicted to have a large impact on total expenditure. However, in a controlled laboratory experiment, we find the incumbency advantage increases total expenditure by a significant amount. Further, we find that carryover has a discouraging effect on challengers while encouraging incumbents react in a retaliatory manner.

Keywords

Infinitely repeated gamesTullock contestsIncumbency advantageLaboratory experiments

JEL classification

C91: Laboratory, Individual Behavior D72: Political Processes: Rent-Seeking, Lobbying, Elections, Legislatures, and Voting Behavior C72: Noncooperative Games
Type
Original Paper
Information
Journal of the Economic Science Association , Volume 10 , Issue 2: Special Issue: Behavioral and Experimental Economics for Innovative Policy-Making (Articles 1 to 3) , December 2024 , pp. 232 - 254
Copyright
Copyright © The Author(s), under exclusive licence to Economic Science Association 2024.

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