Economic Theory

, Volume 8, Issue 2, pp 291–305 | Cite as

The all-pay auction with complete information

  • Michael R. Baye
  • Dan Kovenock
  • Casper G. de Vries
Research Articles


In a (first price) all-pay auction, bidders simultaneously submit bids for an item. All players forfeit their bids, and the high bidder receives the item. This auction is widely used in economics to model rent seeking, R&D races, political contests, and job promotion tournaments. We fully characterize equilibrium for this class of games, and show that the set of equilibria is much larger than has been recognized in the literature. When there are more than two players, for instance, we show that even when the auction is symmetric there exists a continuum of asymmetric equilibria. Moreover, for economically important configurations of valuations, there is no revenue equivalence across the equilibria; asymmetric equilibria imply higher expected revenues than the symmetric equilibrium.

JEL classification numbers

D44 D72 


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Copyright information

© Springer-Verlag 1996

Authors and Affiliations

  • Michael R. Baye
    • 1
  • Dan Kovenock
    • 2
  • Casper G. de Vries
    • 3
  1. 1.Department of EconomicsThe Pennsylvania State University, State CollegeUSA
  2. 2.Department of EconomicsPurdue UniversityWest LafayetteUSA
  3. 3.Tinbergen InstituteDR RotterdamThe Netherlands

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