Rent-seeking contests with private values and common knowledge about the mean
Andrea Gallice ()
No 23, Working papers from Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino
We study a rent-seeking contest in which players have heterogeneous and private valuations. In addition to their own type, agents only know that all valuations are drawn from a distribution, of which they only know the mean. We obtain a closed-form solution for agents' optimal level of investment and subject it to comparative statics analysis. We also investigate the issue of entry in the game and the amount of rent dissipation that results in equilibrium. Finally, we compare our results with those that would emerge in a context of perfect information.
Keywords: rent-seeking; contests; private information; imperfect information (search for similar items in EconPapers)
JEL-codes: D72 D82 (search for similar items in EconPapers)
Pages: 16 pages
New Economics Papers: this item is included in nep-cta, nep-gth and nep-mic
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http://www.bemservizi.unito.it/repec/tur/wpapnw/m23.pdf First version, 2013 (application/pdf)
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Persistent link: https://EconPapers.repec.org/RePEc:tur:wpapnw:023
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