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An Application Game with Fees and Time Costs


  • Christopher Cotton

    () (Department of Economics, University of Miami)


In an application game, agents decide whether to apply for the prize, and reviewing applica- tions allows the decision maker to learn agent qualifications and award prizes to qualified agents. The decision maker finds reviewing applications costly, and prefers not to review applications from agents with sufficiently low probability of being qualified. Positive application fees and time delays can assure that only those with a high-enough probability of being qualified apply for prizes. Applied to the journal submission process, in which tenured and untenured academic authors are affected differently by time delays, the model shows that using time delays instead of higher submission fees benefits tenured authors at the expense of both untenured authors and journal quality. Applied to the process of applying for a permit when there are both rich and poor potential applicants, the model shows that the decision maker should impose both application fees and time delays (e.g., red tape). In this case, eliminating fees benefits poor agents, while it harms rich agents and the decision maker; eliminating red tape benefits rich agents, while it harms poor agents and the decision maker.

Suggested Citation

  • Christopher Cotton, 2008. "An Application Game with Fees and Time Costs," Working Papers 0904, University of Miami, Department of Economics.
  • Handle: RePEc:mia:wpaper:0904

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    References listed on IDEAS

    1. Banerjee, A.V., 1997. "A Theory of Misgovernance," Working papers 97-4, Massachusetts Institute of Technology (MIT), Department of Economics.
    2. Ofer H. Azar, 2005. "The Review Process in Economics: Is It Too Fast?," Southern Economic Journal, Southern Economic Association, vol. 72(2), pages 482-491, October.
    3. Abhijit V. Banerjee, 1997. "A Theory of Misgovernance," The Quarterly Journal of Economics, Oxford University Press, vol. 112(4), pages 1289-1332.
    4. Glenn Ellison, 2002. "Evolving Standards for Academic Publishing: A q-r Theory," Journal of Political Economy, University of Chicago Press, vol. 110(5), pages 994-1034, October.
    5. Guriev, Sergei, 2004. "Red tape and corruption," Journal of Development Economics, Elsevier, vol. 73(2), pages 489-504, April.
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    More about this item


    journal submission; red tape; application fees;

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption

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