Bid Caps in Noisy Contests
研究了多人噪声竞赛中刚性或弹性投标上限的最优设计，发现弹性上限优于刚性，且当设计者最大化总投标额时，不设上限最优。
This paper studies optimal bid caps in a multiplayer noisy contest in which a higher bid does not guarantee a sure win. The bid cap can be either rigid or flexible. The former imposes outright bidding restrictions on players’ bids, while the latter taxes bids. A designer structures the bid cap to maximize a weighted sum between aggregate bid and tax revenue. Our analysis characterizes the optimum. A rigid bid is always outperformed by flexible ones, and a laissez-faire policy—i.e., no cap—is optimal when the designer maximizes the aggregate bid. The results also generate novel practical implications.