IDEAS home Printed from https://ideas.repec.org/h/spr/sprchp/978-3-540-79182-9_29.html
   My bibliography  Save this book chapter

Strategic restraint in contests

In: 40 Years of Research on Rent Seeking 1

Author

Listed:
  • Gil S. Epstein

    (Bar-Ilan University
    Center for Economic Policy Research
    IZA)

  • Shmuel Nitzan

    (Bar-Ilan University)

Abstract

Economic policy is modelled as the outcome of a (political) game between two interest groups. The possible ex-post (realized) outcomes in the game correspond to the proposed policies. In the literature policy proposals are exogenous. We extend such games by allowing the endogenous determination of the proposed policies. In a first stage the groups decide which policy to lobby for and then, in a second stage, engage in a contest over the proposed policies. Our main result is that competition over endogenously determined policies induces strategic restraint that reduces polarization and, in turn, wasteful lobbying activities.

Suggested Citation

  • Gil S. Epstein & Shmuel Nitzan, 2002. "Strategic restraint in contests," Springer Books, in: Roger D. Congleton & Arye L. Hillman & Kai A. Konrad (ed.), 40 Years of Research on Rent Seeking 1, pages 421-430, Springer.
    • Handle: RePEc:spr:sprchp:978-3-540-79182-9_29
    DOI: 10.1007/978-3-540-79182-9_29
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Heinrich W. Ursprung, 2008. "Public Goods, Rent Dissipation, And Candidate Competition," Springer Books, in: Roger D. Congleton & Arye L. Hillman & Kai A. Konrad (ed.), 40 Years of Research on Rent Seeking 1, pages 329-346, Springer.
    2. Chung, Tai-Yeong, 1996. "Rent-Seeking Contest When the Prize Increases with Aggregate Efforts," Public Choice, Springer, vol. 87(1-2), pages 55-66, April.
    3. Baik, Kyung Hwan & Kim, In-Gyu, 1997. "Delegation in contests," European Journal of Political Economy, Elsevier, vol. 13(2), pages 281-298, May.
    4. Epstein, Gil S. & Nitzan, Shmuel, 2003. "The social cost of rent seeking when consumer opposition influences monopoly behavior," European Journal of Political Economy, Elsevier, vol. 19(1), pages 61-69, March.
    5. Avinash Dixit, 2008. "Strategic Behavior in Contests," Springer Books, in: Roger D. Congleton & Arye L. Hillman & Kai A. Konrad (ed.), 40 Years of Research on Rent Seeking 1, pages 431-438, Springer.
    6. Skaperdas, Stergios, 1992. "Cooperation, Conflict, and Power in the Absence of Property Rights," American Economic Review, American Economic Association, vol. 82(4), pages 720-739, September.
    7. Elie Appelbaum & Eliakim Katz, 2008. "Seeking Rents by Setting Rents: The Political Economy of Rent Seeking," Springer Books, in: Roger D. Congleton & Arye L. Hillman & Kai A. Konrad (ed.), 40 Years of Research on Rent Seeking 1, pages 555-569, Springer.
    8. Torsten Schmidt, 1992. "Rent‐Seeking Firms And Consumers: An Equilibrium Analysis," Economics and Politics, Wiley Blackwell, vol. 4(2), pages 137-149, July.
    9. Kyung H. Baik & Jason F. Shogren, 2008. "Strategic Behavior in Contests: Comment," Springer Books, in: Roger D. Congleton & Arye L. Hillman & Kai A. Konrad (ed.), 40 Years of Research on Rent Seeking 1, pages 439-442, Springer.
    10. Onsong Shin & Michael R. Baye, 1999. "Strategic Behavior in Contests: Comment," American Economic Review, American Economic Association, vol. 89(3), pages 691-693, June.
    11. Stergios Skaperdas, 1996. "Contest success functions (*)," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 7(2), pages 283-290.
    12. Kohli, Inderjit & Singh, Nirvikar, 1999. "Rent Seeking and Rent Setting with Asymmetric Effectiveness of Lobbying," Public Choice, Springer, vol. 99(3-4), pages 275-298, June.
    13. Tore Ellingsen, 2008. "Strategic Buyers and the Social Cost of Monopoly," Springer Books, in: Roger D. Congleton & Arye L. Hillman & Kai A. Konrad (ed.), 40 Years of Research on Rent Seeking 1, pages 399-408, Springer.
    14. Gil S. Epstein & Shmuel Nitzan, 2002. "Endogenous Public Policy, Politicization and Welfare," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 4(4), pages 661-677, October.
    15. Sun, Guang-Zhen & Ng, Yew-Kwang, 1999. "The Effect of Number and Size of Interest Groups on Social Rent Dissipation," Public Choice, Springer, vol. 101(3-4), pages 251-265, December.
    16. Amihai Glazer & Henry McMillan, 1992. "Pricing by the Firm Under Regulatory Threat," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(3), pages 1089-1099.
    17. Cairns, Robert D. & Van Long, Ngo, 1991. "Rent seeking with uncertain opposition," European Economic Review, Elsevier, vol. 35(6), pages 1223-1235, August.
    18. Gradstein, Mark, 1993. "Rent Seeking and the Provision of Public Goods," Economic Journal, Royal Economic Society, vol. 103(420), pages 1236-1243, September.
    19. Baik, Kyung Hwan, 1999. "Rent-Seeking Firms, Consumer Groups, and the Social Costs of Monopoly," Economic Inquiry, Western Economic Association International, vol. 37(3), pages 541-553, July.
    20. Nitzan, Shmuel, 1994. "Modelling rent-seeking contests," European Journal of Political Economy, Elsevier, vol. 10(1), pages 41-60, May.
    21. Gary S. Becker, 1983. "A Theory of Competition Among Pressure Groups for Political Influence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 98(3), pages 371-400.
    Full references (including those not matched with items on IDEAS)

    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. 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.
    2. Baik, Kyung Hwan, 1998. "Difference-form contest success functions and effort levels in contests," European Journal of Political Economy, Elsevier, vol. 14(4), pages 685-701, November.
    3. Gil Epstein & Shmuel Nitzan, 2006. "The struggle over migration policy," Journal of Population Economics, Springer;European Society for Population Economics, vol. 19(4), pages 703-723, October.
    4. Kyung Hwan Baik & Jong Hwa Lee, 2013. "Endogenous Timing In Contests With Delegation," Economic Inquiry, Western Economic Association International, vol. 51(4), pages 2044-2055, October.
    5. Nti, Kofi O., 1998. "Effort and performance in group contests," European Journal of Political Economy, Elsevier, vol. 14(4), pages 769-781, November.
    6. Gil S. Epstein & Shmuel Nitzan, 2005. "Lobbying and Compromise," CESifo Working Paper Series 1413, CESifo.
    7. Gil S. Epstein & Shmuel Nitzan, 2003. "Political culture and monopoly price determination," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 21(1), pages 1-19, August.
    8. Leyla D. Karakas, 2018. "Appeasement and compromise under a referendum threat," Economics of Governance, Springer, vol. 19(3), pages 261-283, August.
    9. repec:elg:eechap:15325_4 is not listed on IDEAS
    10. Gil Epstein & Igal Milchtaich & Shmuel Nitzan & Mordechai Schwarz, 2007. "Ambiguous political power and contest efforts," Public Choice, Springer, vol. 132(1), pages 113-123, July.
    11. Kahana, Nava & Nitzan, Shmuel, 1999. "Uncertain preassigned non-contestable and contestable rents," European Economic Review, Elsevier, vol. 43(9), pages 1705-1721, October.
    12. Gil S. Epstein & Yosef Mealem, 2013. "Politicians, Governed vs. Non-Governed Interest Groups and Rent Dissipation," Working Papers 2013-09, Bar-Ilan University, Department of Economics.
    13. Gil Epstein & Shmuel Nitzan, 2006. "The Politics of Randomness," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 27(2), pages 423-433, October.
    14. Gil Epstein & Yosef Mealem, 2015. "Politicians, governed versus non-governed interest groups and rent dissipation," Theory and Decision, Springer, vol. 79(1), pages 133-149, July.
    15. Kyung Hwan Baik, 1994. "Winner‐Help‐Loser Group Formation In Rent‐Seeking Contests," Economics and Politics, Wiley Blackwell, vol. 6(2), pages 147-162, July.
    16. Yohan Pelosse, 2024. "Sequential Contest when the Precision of Observation is Endogenous," Working Papers 2024-02, Swansea University, School of Management.
    17. Kyung Hwan Baik & In‐Gyu Kim, 2007. "Strategic Decisions On Lawyers’ Compensation In Civil Disputes," Economic Inquiry, Western Economic Association International, vol. 45(4), pages 854-863, October.
    18. Hoffmann, Magnus & Rota-Graziosi, Grégoire, 2012. "Endogenous timing in general rent-seeking and conflict models," Games and Economic Behavior, Elsevier, vol. 75(1), pages 168-184.
    19. Stefan Brandauer & Florian Englmaier, 2009. "A model of strategic delegation in contests between groups," Review of Economic Design, Springer;Society for Economic Design, vol. 13(3), pages 205-232, September.
    20. Gil S. Epstein & Shmuel Nitzan, 2006. "Effort and Performance in Public Policy Contests," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 8(2), pages 265-282, May.
    21. Morgan, John & Vardy, Felix, 2007. "The value of commitment in contests and tournaments when observation is costly," Games and Economic Behavior, Elsevier, vol. 60(2), pages 326-338, August.

    More about this item

    Keywords

    Interest groups; Endogenous lobbying targets; Voluntary restraint; Polarization; Voluntary restraint;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

    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:spr:sprchp:978-3-540-79182-9_29. 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.