Rent-seeking with scarce talent: A model of preemptive hiring

Sami Dakhlia and Paul Pecorino ()

Public Choice, 2006, vol. 129, issue 3, 475-486

Abstract: In a standard rent-seeking contest, players optimally employ resources in an attempt to obtain the rent. Typically, it is assumed that these resources may be hired at any desired level at some exogenous per-unit cost. In practice, these resources often consist of scarce, talented individuals. We model a rent-seeking contest with scarce talent and find that talent scarcity leads to preemptive hiring by the player receiving the larger rent. This player hires all available talent and wins the contest with probability 1. This is true even when the difference in rents is small. Copyright Springer Science + Business Media B.V. 2006

Keywords: Rent-seeking; Scarce talent; Labor market; Lobbying; Preemptive hiring (search for similar items in EconPapers)
Date: 2006
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Working Paper: Rent-seeking with scarce talent: a model of preemptive hiring (2005)
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DOI: 10.1007/s11127-006-9067-3

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