Effort Complementarity and Sharing Rules in Group Contests ∗ Katsuya Kobayashi † Hideo Konishi ‡ April 10, 2020 Abstract In this paper, we consider a prize-sharing rule design problem in a group contest with effort complementarities within groups by employing a CES effort aggregator function. We derive the conditions for a monopolization rule that dominates an egalitarian rule if the objective of the rule design is to maximize the group’s winning probability. We find conditions under which the monopolization rule maximizes the group’s winning probabil- ity, while the egalitarian rule is strictly preferred by all members of the group. Without effort complementarity, there cannot be such a conflict of interest. Keywords: group contest, complementarity in efforts, free riding, prize-sharing rule JEL Classification Numbers: C72, D23, D74 * We thank Editor Fran¸cois Maniquet, Associate Editor, and two anonymous referees for their helpful com- ments and suggestions. Special thanks are due to Kaoru Ueda for his valuable comments on an earlier version of the paper. This paper was completed when Kobayashi was visiting Boston College on his sabbatical. Kobayashi thanks Hosei University for their financial support and Boston College for their hospitality. † Email katsuyak@hosei.ac.jp, Faculty of Economics, Hosei University, 4342 Aihara-machi, Machida-shi, Tokyo 194-0298, Japan. ‡ Email hideo.konishi@bc.edu, Department of Economics, Boston College, 140 Commonwealth Ave., Chestnut Hill, MA 02467 USA. 1