Impulsive Behavior in Competition: Testing Theories of Overbidding in Rent-Seeking Contests

Roman Sheremeta ()
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Roman Sheremeta: Weatherhead School of Management, Case Western Reserve University and Economic Science Institute, Chapman University

Working Papers from Chapman University, Economic Science Institute

Abstract: Researchers have proposed various theories to explain overbidding in rent-seeking contents, including mistakes, systematic biases, the utility of winning, and relative payoff maximization. Through an eight-part experiment, we test and find significant support for the existing theories. Also, we discover some new explanations based on cognitive ability and impulsive behavior. Out of all explanations examined, we find that impulsivity is the most important factor explaining overbidding in contests.

Keywords: rent-seeking; contest; competition; impulsive behavior; experiments (search for similar items in EconPapers)
JEL-codes: C72 C91 D01 D72 (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-exp, nep-gth, nep-hpe and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (44)

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http://www.chapman.edu/research-and-institutions/e ... overbidding-2016.pdf

Related works:
Working Paper: Impulsive Behavior in Competition: Testing Theories of Overbidding in Rent-Seeking Contests (2018)
Working Paper: Impulsive Behavior in Competition: Testing Theories of Overbidding in Rent-Seeking Contests (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:chu:wpaper:16-21

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