Econometric Society 57th European Meeting
25th August 2002 - 28th August 2002, Venice, Italy

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MECHANISM DESIGN OF INTERACTIVE QUIZ SHOWS:ARE SIMPLE QUESTIONS OPTIMAL?


Category: Economic Theory
Mechanism Design
Sunday 25th August 2002, 09:30 - 11:00, Room: 4.6
Session Chair(s): David Wettstein, Ben Gurion University, ISRAEL

Presenter(s): Groh, Christian

Co-Author(s): none

Keyword(s): entertainment, gambling, media, noncooperative game theory

JEL(s): C72, L82, L83

Abstract:

In german TV, there recently have appeared a number of interactive quiz shows. A usually very simple question is asked and spectators may make a costly phone call. One of the callers is selected randomly and, if he knows the answer, is allocated a prize. The TV channel's revenue from these calls is the expected number of callers times the price of the phone call. Simple questions increase the number of phone calls since more spectators know the answer. However, the likelihood of winning for any caller decreases with each additional caller. I analyze this trade-off in a Bayesian setting and find that the most simple questions are optimal indeed.


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Paper Reference Number: 1136

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57th European Meeting
25th August 2002 - 28th August 2002, Venice, Italy

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