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Rent seeking in sequential group contests

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  • Oliver Gürtler

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    Abstract

    In this paper, a group contest is analyzed, where the groups are allowed to determine their sharing rules either sequentially or simultaneously. It is found that in case the more numerous group determines its sharing rule prior to the smaller group, rent dissipation in the group contest is higher than in an individual contest. However, if the order of moves is endogenized, the smaller group will always act prior to the bigger group. Competition between the groups is in this way weakened and the groups are able to save on expenditures.

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    File URL: http://www.wiwi.uni-bonn.de/bgsepapers/bonedp/bgse2_2005.pdf
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    Bibliographic Info

    Paper provided by University of Bonn, Germany in its series Bonn Econ Discussion Papers with number bgse2_2005.

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    Length: 22
    Date of creation: Jan 2005
    Date of revision:
    Handle: RePEc:bon:bonedp:bgse2_2005

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    Postal: Bonn Graduate School of Economics, University of Bonn, Adenauerallee 24 - 26, 53113 Bonn, Germany
    Fax: +49 228 73 6884
    Web page: http://www.bgse.uni-bonn.de

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    1. Kyle Bagwell, 1992. "Commitment and Observability in Games," Discussion Papers 1014, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
    2. Christian Riis & Derek J. Clark, 1997. "Contest success functions: an extension," Economic Theory, Springer, vol. 11(1), pages 201-204.
    3. Skaperdas, Stergios, 1996. "Contest Success Functions," Economic Theory, Springer, vol. 7(2), pages 283-90, February.
    4. Lee, Sanghack & Hyeong Kang, J., 1998. "Collective contests with externalities," European Journal of Political Economy, Elsevier, vol. 14(4), pages 727-738, November.
    5. Akerlof, George A, 1976. "The Economics of Caste and of the Rat Race and Other Woeful Tales," The Quarterly Journal of Economics, MIT Press, vol. 90(4), pages 599-617, November.
    6. Nitzan, Shmuel, 1991. "Collective Rent Dissipation," Economic Journal, Royal Economic Society, vol. 101(409), pages 1522-34, November.
    7. Morgan, John, 2003. " Sequential Contests," Public Choice, Springer, vol. 116(1-2), pages 1-18, July.
    8. Dye, Ronald A, 1984. "The Trouble with Tournaments," Economic Inquiry, Western Economic Association International, vol. 22(1), pages 147-49, January.
    9. Hwan Baik, Kyung & Lee, Sanghack, 1997. "Collective rent seeking with endogenous group sizes," European Journal of Political Economy, Elsevier, vol. 13(1), pages 121-130, February.
    10. Nitzan, Shmuel, 1991. " Rent-Seeking with Non-identical Sharing Rules," Public Choice, Springer, vol. 71(1-2), pages 43-50, August.
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