Rent Seeking and Rent Dissipation: A Neutrality ResultJournal of Public Economics (2010)
AbstractWe consider rent seeking contests between at least two agents who might value the prize differently. We capture a wide range of institutional aspects of contests by analyzing a class of contest success functions fulfilling several properties. The main properties are anonymity and a condition on the elasticity of a rent seeker's win probability with respect to her effort. We show the existence of a mixed-strategy equilibrium and establish equilibrium payoffs. In this equilibrium complete rent dissipation holds. Our results imply a partial robustness result for the all-pay auction.
- (non-)deterministic contest,
- all-pay auction,
- contest success functions.
Publication DateFebruary, 2010
Citation InformationJose Alcalde and Matthias Dahm. "Rent Seeking and Rent Dissipation: A Neutrality Result" Journal of Public Economics Vol. 94 Iss. 1-2 (2010)
Available at: http://works.bepress.com/jose_alcalde/5/