This paper analyses a model of overlapping generations in which agents who do notparticipate in the labor market are unable to borrow. Thus an increase in a fullyfunded pension raises aggregate savings even with a fixed participation rate, sinceprivate savings are not crowded out one-for-one....

The rent-seeking model of Tullock (1980) has stimulated a large literature on rent-seekingcontests, of which Hillman (1989) and Nitzan (1994) provide useful surveys. AlthoughTullock's 'winner take all' model has been adapted and extended in numerous ways, thereremain fundamental modeling issues,...