Asymmetric discouragement in asymmetric contests

- We provide new experimental evidence on asymmetric contests.
- Our findings suggest an asymmetric discouragement effect.
- Compared to a symmetric contest, subjects invest less when facing a stronger opponent.
- However, they invest the same when facing a weaker opponent.
- Disappointment aversion rationalizes the results.

We provide new experimental evidence which suggests an asymmetric discouragement effect in lottery contests with heterogeneous abilities. Compared to a symmetric contest, subjects invest less effort when facing a stronger opponent, but they invest the same when facing a weaker opponent. Our results can be explained by a simple model of disappointment aversion.