IDEAS home Printed from https://ideas.repec.org/a/kap/pubcho/v124y2005i3p411-422.html
   My bibliography  Save this article

Rents, dissipation and lost treasures: Rethinking Tullock's paradox

Author

Listed:
  • Giuseppe Dari-Mattiacci
  • Francesco Parisi

Abstract

In this paper we revisit Tullock's paradox (Tullock, 1980) and consider a rent-seeking game in which parties face increasing returns to effort. We allow parties to randomize their strategies and give them an exit option. Given the mixed participation strategies of the parties, valuable rents may occasionally remain unexploited. We consider such a lost-treasure effect as an additional cost of rent seeking and examine how the expected value of such a lost rent varies with changes in the parameters of the problem. Copyright Springer Science + Business Media, Inc. 2005

Suggested Citation

  • Giuseppe Dari-Mattiacci & Francesco Parisi, 2005. "Rents, dissipation and lost treasures: Rethinking Tullock's paradox," Public Choice, Springer, vol. 124(3), pages 411-422, September.
    • Handle: RePEc:kap:pubcho:v:124:y:2005:i:3:p:411-422
    DOI: 10.1007/s11127-005-2056-0
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s11127-005-2056-0
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11127-005-2056-0?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    2. Arye Hillman & Dov Samet, 1987. "Characterizing equilibrium rent-seeking behavior: A reply to Tullock," Public Choice, Springer, vol. 54(1), pages 85-87, January.
    3. Bhagwati, Jagdish N, 1982. "Directly Unproductive, Profit-seeking (DUP) Activities," Journal of Political Economy, University of Chicago Press, vol. 90(5), pages 988-1002, October.
    4. Gordon Tullock, 1985. "Efficient rents 3 back to the bog," Public Choice, Springer, vol. 46(3), pages 259-263, January.
    5. Perez-Castrillo, J David & Verdier, Thierry, 1992. "A General Analysis of Rent-Seeking Games," Public Choice, Springer, vol. 73(3), pages 335-350, April.
    6. Robert Tollison, 2012. "The economic theory of rent seeking," Public Choice, Springer, vol. 152(1), pages 73-82, July.
    7. Robert D. Tollison, 1982. "Rent Seeking: A Survey," Kyklos, Wiley Blackwell, vol. 35(4), pages 575-602, November.
    8. Baye, Michael R & Kovenock, Dan & de Vries, Casper G, 1994. "The Solution to the Tullock Rent-Seeking Game When R Is Greater Than 2: Mixed-Strategy Equilibria and Mean Dissipation Rates," Public Choice, Springer, vol. 81(3-4), pages 363-380, December.
    9. Baye, Michael R & Kovenock, Dan & de Vries, Casper G, 1999. "The Incidence of Overdissipation in Rent-Seeking Contests," Public Choice, Springer, vol. 99(3-4), pages 439-454, June.
    10. Baye, M.R. & Kovenock, D. & De Vries, C.G., 1993. "The Solution to the Tullock Rent-Seeking Game when R > 2: Mixed Strategy Equilibria and Mean Dissipation Rates," Papers 10-93-9, Pennsylvania State - Department of Economics.
    11. Robert D. Tollison & Roger D. Congleton (ed.), 1995. "The Economic Analysis Of Rent Seeking," Books, Edward Elgar Publishing, number 592.
    12. Tullock, Gordon, 1995. "The Reluctant Gamesperson--A Comment," Public Choice, Springer, vol. 85(1-2), pages 189-192, October.
    13. Posner, Richard A, 1975. "The Social Costs of Monopoly and Regulation," Journal of Political Economy, University of Chicago Press, vol. 83(4), pages 807-827, August.
    14. Krueger, Anne O, 1974. "The Political Economy of the Rent-Seeking Society," American Economic Review, American Economic Association, vol. 64(3), pages 291-303, June.
    15. Charles Rowley & Anne Rathbone, 2013. "The political economy of antitrust," Chapters, in: Manfred Neumann & Jürgen Weigand (ed.), The International Handbook of Competition – Second Edition, chapter 6, pages 169-206, Edward Elgar Publishing.
    16. Rowley, Charles K, 1991. "Gordon Tullock: Entrepreneur of Public Choice," Public Choice, Springer, vol. 71(3), pages 149-169, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bonardi Jean-Philippe & Urbiztondo Santiago, 2013. "Asset freezing, corporate political resources and the Tullock paradox," Business and Politics, De Gruyter, vol. 15(3), pages 275-293, October.
    2. Christian Ewerhart, 2015. "Mixed equilibria in Tullock contests," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 60(1), pages 59-71, September.
    3. Johannes Münster, 2007. "Rents, dissipation and lost treasures: Comment," Public Choice, Springer, vol. 130(3), pages 329-335, March.
    4. Schaefer Hans-Bernd, 2020. "Laudatio: Francesco Parisi," Review of Law & Economics, De Gruyter, vol. 16(1), pages 1-9, March.
    5. Barbara Luppi & Francesco Parisi, 2012. "Litigation and legal evolution: does procedure matter?," Public Choice, Springer, vol. 152(1), pages 181-201, July.
    6. Guerra Alice & Luppi Barbara & Parisi Francesco, 2019. "Standards of Proof and Civil Litigation: A Game-Theoretic Analysis," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 19(1), pages 1-19, January.
    7. Maria Alessandra Antonelli, 2010. "Income Distribution And Rent Seeking Costs: A Note," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 10(3), pages 5-12.
    8. Münster, Johannes, 2006. "Rents, dissipation and lost treasures: comment," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 119, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
    9. Karl Wärneryd, 2012. "Nine points of the law: evidentiary rules and the costs of litigation," Public Choice, Springer, vol. 153(3), pages 279-285, December.
    10. Francesco Parisi & Barbara Luppi & Alice Guerra, 2017. "Gordon Tullock and the Virginia School of Law and Economics," Constitutional Political Economy, Springer, vol. 28(1), pages 48-61, March.
    11. Martin Gregor, 2016. "Tullock's Puzzle in Pay-and-Play Lobbying," Economics and Politics, Wiley Blackwell, vol. 28(3), pages 368-389, November.
    12. Parisi Francesco, 2020. "Law and Economics as We Grow Younger," Review of Law & Economics, De Gruyter, vol. 16(1), pages 1-20, March.
    13. Giuseppe Dari-Mattiacci & Sander Onderstal & Francesco Parisi, 2009. "Seeking rents in the shadow of Coase," Public Choice, Springer, vol. 139(1), pages 171-196, April.
    14. Epstein Gil S. & Lindner Pomerantz Renana, 2011. "Media and Litigation," Review of Law & Economics, De Gruyter, vol. 7(2), pages 539-571, December.
    15. repec:elg:eechap:15325_17 is not listed on IDEAS
    16. Florian Baumann & Tim Friehe, 2013. "A note on the timing of investments in litigation contests," European Journal of Law and Economics, Springer, vol. 35(3), pages 313-326, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Giuseppe Dari-Mattiacci & Eric Langlais & Bruno Lovat & Francesco Parisi, 2007. "Crowding-out in productive and redistributive rent-seeking," Public Choice, Springer, vol. 133(1), pages 199-229, October.
    2. Antoine Gentier & Giusepina Gianfreda & Nathalie Janson, 2011. "Rent dissipation or government predation ? The notes issuance activity in Italy 1865-1882," Post-Print hal-00735325, HAL.
    3. Maria Arbatskaya & Hugo Mialon, 2010. "Multi-activity contests," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 43(1), pages 23-43, April.
    4. Douglas Davis & Robert Reilly, 1998. "Do too many cooks always spoil the stew? An experimental analysis of rent-seeking and the role of a strategic buyer," Public Choice, Springer, vol. 95(1), pages 89-115, April.
    5. Alcalde, José & Dahm, Matthias, 2010. "Rent seeking and rent dissipation: A neutrality result," Journal of Public Economics, Elsevier, vol. 94(1-2), pages 1-7, February.
    6. Ewerhart, Christian, 2017. "Contests with small noise and the robustness of the all-pay auction," Games and Economic Behavior, Elsevier, vol. 105(C), pages 195-211.
    7. Arye L. Hillman & John G. Riley, 1989. "Politically Contestable Rents And Transfers," Economics and Politics, Wiley Blackwell, vol. 1(1), pages 17-39, March.
    8. Bruno S. Frey, "undated". "Knight Fever towards an Economics of Awards," IEW - Working Papers 239, Institute for Empirical Research in Economics - University of Zurich.
    9. Antoine Gentier & Giuseppina Gianfreda & Nathalie Janson, 2006. "The Question of the Rent Dissipation in the Notes Issuance Activity: The Case of the Italian Banking System before the Creation of the Bank of Italy," CAE Working Papers 45, Aix-Marseille Université, CERGAM.
    10. Lim, Wooyoung & Matros, Alexander, 2009. "Contests with a stochastic number of players," Games and Economic Behavior, Elsevier, vol. 67(2), pages 584-597, November.
    11. T. Guse & B. Hehenkamp, 2006. "The strategic advantage of interdependent preferences in rent-seeking contests," Public Choice, Springer, vol. 129(3), pages 323-352, December.
    12. Christian Ewerhart, 2015. "Mixed equilibria in Tullock contests," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 60(1), pages 59-71, September.
    13. Amihai Glazer, 2008. "Crowding Out Wasteful Activities by Wasteful Activities," Working Papers 080908, University of California-Irvine, Department of Economics.
    14. Jay S. Coggins, 1995. "Rent Dissipation And The Social Cost Of Price Policy," Economics and Politics, Wiley Blackwell, vol. 7(2), pages 147-166, July.
    15. Aleksandar Vasilev, 2013. "On the cost of rent-seeking by government bureaucrats in a Real-Business-Cycle framework," Working Papers 2013_20, Business School - Economics, University of Glasgow.
    16. Stela Cani, 2009. "Resource Abundance, Mineral Funds and Institutional Quality," Economics Discussion Papers em-dp2009-04, Department of Economics, University of Reading.
    17. Konrad, Kai A., 2007. "Strategy in contests: an introduction [Strategie in Turnieren – eine Einführung]," Discussion Papers, Research Unit: Market Processes and Governance SP II 2007-01, WZB Berlin Social Science Center.
    18. Amihai Glazer & Stef Proost, 2010. "Reducing Rent Seeking by Providing Wide Public Service," Working Papers 101106, University of California-Irvine, Department of Economics.
    19. Coggins, Jay S., 1992. "Rent Dissipation and the Social Cost of Price Policy," Staff Papers 200551, University of Wisconsin-Madison, Department of Agricultural and Applied Economics.
    20. Dmitry Ryvkin, 2007. "Tullock contests of weakly heterogeneous players," Public Choice, Springer, vol. 132(1), pages 49-64, July.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:pubcho:v:124:y:2005:i:3:p:411-422. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.