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Rent seeking and rent dissipation: A neutrality result

  • Alcalde, José
  • Dahm, Matthias

We 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.

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Article provided by Elsevier in its journal Journal of Public Economics.

Volume (Year): 94 (2010)
Issue (Month): 1-2 (February)
Pages: 1-7

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Handle: RePEc:eee:pubeco:v:94:y:2010:i:1-2:p:1-7
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505578

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