How To Avoid Awarding a Valuable Asset
Many mechanisms (such as auctions) efficiently allocate a good to the firm which most highly values it. But sometimes the owner of the asset or good may wish to transfer it only if it is not too valuable to potential buyers. The allocation problem becomes especially difficult when the potential buyers have private information about the asset’s value. We describe several mechanisms which are efficient, or nearly so. We also show that rent seeking, and lobbying, rather than merely wasting resources, can lead to allocations which are close to efficient.
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- Posner, Richard A, 1975. "The Social Costs of Monopoly and Regulation," Journal of Political Economy, University of Chicago Press, vol. 83(4), pages 807-27, August.
- Lohmann, Susanne, 1995. " Information, Access, and Contributions: A Signaling Model of Lobbying," Public Choice, Springer, vol. 85(3-4), pages 267-84, December.
- Konrad, Kai A. & Kovenock, Dan, 2006.
CEPR Discussion Papers
5645, C.E.P.R. Discussion Papers.
- Konrad, Kai A. & Kovenock, Dan, 2006. "Multi-battle contests," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 122, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
- Konrad, Kai A. & Kovenock, Dan, 2006. "Multi-battle contests," Purdue University Economics Working Papers 1187, Purdue University, Department of Economics.
- Konrad, Kai A. & Kovenock, Dan, 2009. "Multi-battle contests," Munich Reprints in Economics 22084, University of Munich, Department of Economics.
- 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.
- Amihai Glazer & Kai A. Konrad, 1995. "Strategic Lobbying By Potential Industry Entrants," Economics and Politics, Wiley Blackwell, vol. 7(2), pages 167-179, 07.
- 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.
- Rasmusen, Eric, 1993. " Lobbying When the Decisionmaker Can Acquire Independent Information," Public Choice, Springer, vol. 77(4), pages 899-913, December.
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