Reimbursement as a tool to reduce sabotaging in rent‐seeking contests

Yizhaq Minchuk

Managerial and Decision Economics, 2021, vol. 42, issue 1, 235-238

Abstract: We study standard rent‐seeking contests with reimbursement and sabotaging. This study is conducted for a symmetric model with complete information. We show that changing the contest mechanism by applying a form of reimbursement could be an effective tool against sabotaging, in addition to the fact that it increases contest designer revenue. Simple changes such as sufficient reimbursement to winners/losers might completely stop sabotaging efforts in the contest.

Date: 2021
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https://doi.org/10.1002/mde.3228

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Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:42:y:2021:i:1:p:235-238

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