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How To Avoid Awarding a Valuable Asset

Sam Bucovetsky () and Amihai Glazer

No 50619, Working Papers from University of California-Irvine, Department of Economics

Abstract: 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.

Keywords: Rent seeking; Lobbying; Auctions; Asymmetric information (search for similar items in EconPapers)
JEL-codes: D44 D72 D82 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2006-01
New Economics Papers: this item is included in nep-cfn and nep-fmk
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