Search Duplication in Research and Design Spaces - Exploring the Role of Local Competition

Kai Konrad

Working Papers from Max Planck Institute for Tax Law and Public Finance

Abstract: Clustering and lack of sufficient diversification in research strategies has been identified as an important problem for delegated research as it takes place in design contests by Erat and Krishnan (2012). We show that this problem can be solved by local competition (such as bribery, lobbying or rent seeking) among players who apply the same search strategies or develop the same design. Such competition can restore full efficiency in the non-cooperative equilibrium. Local competition interacts with the choice of whether to cluster or to diversify, and rather than adding a further inefficiency to the existing ones, it eliminates inefficiency. The results are robust and hold under simultaneous search strategy choices as well as for sequential choices.

Keywords: Delegated research; clustering; product design; design contest; search strategy; rent-seeking (search for similar items in EconPapers)
JEL-codes: D72 D74 O32 O33 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2014-10
New Economics Papers: this item is included in nep-com
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

Downloads: (external link)
http://www.tax.mpg.de/RePEc/mpi/wpaper/TAX-MPG-RPS-2014-19.pdf Full text (original version) (application/pdf)

Related works:
Journal Article: Search duplication in research and design spaces — Exploring the role of local competition (2014)
Working Paper: Search duplication in research and design spaces - Exploring the role of local competition (2014)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mpi:wpaper:tax-mpg-rps-2014-19

Access Statistics for this paper

More papers in Working Papers from Max Planck Institute for Tax Law and Public Finance Contact information at EDIRC.
Bibliographic data for series maintained by Hans Mueller (hans.mueller@tax.mpg.de).