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Rent-seeking for a public good with additive contributions

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  • Iryna Topolyan

Abstract

We analyze rent-seeking for a public good with two groups, where the provision of a public good is decided in the all-pay contest where “the winner takes all”. We assume that the valuation of the public good varies across groups, but is the same for all members within a group. Free-riding in such situation was predicted by Baik et al. (J Public Econ 82(3):415–429, 2001 ). We describe a continuum of equilibria where all players make contributions. There is room for substantial payoff asymmetry, which ranges from equal payoffs to all group members to a zero payoff for the player who makes a contribution and positive payoffs for free-riders. The results generalize for the case where the prize has both a private and a public component. Copyright Springer-Verlag Berlin Heidelberg 2014

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  • Iryna Topolyan, 2014. "Rent-seeking for a public good with additive contributions," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 42(2), pages 465-476, February.
    • Handle: RePEc:spr:sochwe:v:42:y:2014:i:2:p:465-476
    DOI: 10.1007/s00355-013-0741-3
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    References listed on IDEAS

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    Cited by:

    1. Cardona, Daniel & Rubí-Barceló, Antoni, 2016. "Group-contests with endogenous claims," European Journal of Political Economy, Elsevier, vol. 44(C), pages 97-111.
    2. Subhasish M. Chowdhury & Iryna Topolyan, 2016. "Best-shot versus weakest-link in political lobbying: an application of group all-pay auction," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 47(4), pages 959-971, December.
    3. Katsuya Kobayashi, 2019. "Step-by-step group contests with group-specific public-good prizes," Economics of Governance, Springer, vol. 20(2), pages 183-204, June.
    4. Arye Hillman & Ngo Van Long, 2017. "The social cost of contestable benefits," CIRANO Working Papers 2017s-11, CIRANO.
    5. Barbieri, Stefano & Kovenock, Dan & Malueg, David A. & Topolyan, Iryna, 2019. "Group contests with private information and the “Weakest Link”," Games and Economic Behavior, Elsevier, vol. 118(C), pages 382-411.
    6. Brookins, Philip & Lightle, John P. & Ryvkin, Dmitry, 2015. "Optimal sorting in group contests with complementarities," Journal of Economic Behavior & Organization, Elsevier, vol. 112(C), pages 311-323.
    7. Subhasish M. Chowdhury & Iryna Topolyan, 2015. "The Group All-Pay Auction with Heterogeneous Impact Functions," University of East Anglia Applied and Financial Economics Working Paper Series 069, School of Economics, University of East Anglia, Norwich, UK..
    8. Arye L. Hillman & Ngo Van Long, 2017. "Rent Seeking: The Social Cost of Contestable Benefits," CESifo Working Paper Series 6462, CESifo.
    9. Dan Kovenock & Brian Roberson, 2018. "The Optimal Defense Of Networks Of Targets," Economic Inquiry, Western Economic Association International, vol. 56(4), pages 2195-2211, October.
    10. Stefano Barbieri & David Malueg & Iryna Topolyan, 2014. "The best-shot all-pay (group) auction with complete information," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 57(3), pages 603-640, November.
    11. Mercier, Jean-François, 2018. "Non-deterministic group contest with private information," Mathematical Social Sciences, Elsevier, vol. 95(C), pages 47-53.
    12. Christian Ewerhart & Marco Serena, 2023. "On the (im-)possibility of representing probability distributions as a difference of i.i.d. noise terms," ECON - Working Papers 428, Department of Economics - University of Zurich, revised Oct 2023.
    13. Brookins, Philip & Jindapon, Paan, 2021. "Risk preference heterogeneity in group contests," Journal of Mathematical Economics, Elsevier, vol. 95(C).
    14. Christian Ewerhart, 2016. "A "fractal" solution to the chopstick auction," ECON - Working Papers 229, Department of Economics - University of Zurich, revised Apr 2017.
    15. Baik, Kyung Hwan & Jung, Hanjoon Michael, 2021. "Contests with multiple alternative prizes: Public-good/bad prizes and externalities," Journal of Mathematical Economics, Elsevier, vol. 92(C), pages 103-116.
    16. Subhasish M. Chowdhury & Dongryul Lee & Iryna Topolyan, 2016. "The Max‐Min Group Contest: Weakest‐link (Group) All‐Pay Auction," Southern Economic Journal, John Wiley & Sons, vol. 83(1), pages 105-125, July.
    17. Vázquez-Sedano Alexis, 2018. "Sharing the Effort Costs in Group Contests," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 18(1), pages 1-21, January.
    18. Christian Ewerhart, 2022. "A “fractal” solution to the chopstick auction," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 74(4), pages 1025-1041, November.
    19. Dongryul Lee & Joon Song, 2019. "Optimal Team Contests to Induce More Efforts," Journal of Sports Economics, , vol. 20(3), pages 448-476, April.

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