The Klein-Leffler (1981) model of product quality does not explain why high-quality firms would dissipate the rents they earn from quality- assuring price premia, and it relies on consumers knowing the cost functions of firms. In the present paper, consumers do not know any firm's cost of...

We experimentally test a rent seeking model under five levels of competition. At one extreme, a subject’s probability of winning a prize is equal to her share of the total expenditures. At lower levels of competition, a subject’s probability of winning is affected more by her own...

Trade opportunities are generally seen as valuable instruments to improve the allocation of resources in society. However, when the traded rights are secured through unproductive rent-seeking contests, the tradeability of the rents may provide stronger incentives to invest in rent-seeking...

It is well known that a pure-strategy Nash equilibrium does not exist for a two-player rent-seeking contest when the contest success function parameter is greater than two. We analyze the contest using the concept of equilibrium in secure strategies, which is a generalization of the Nash...

Trade opportunities are generally seen as valuable instruments to improve the allocation of resources in society. However, when the traded rights are secured through unproductive rent-seeking contests, the tradeability of the rents may provide stronger incentives to invest in rent-seeking...

This paper considers the extent to which expenditure by contestants in imperfectly discriminating rent-seeking contests dissipates all or only part of the rent. In particular, we investigate strategic effects, technological effects and asymmetry under an assumption of diminishing returns to...

This paper considers the extent to which expenditure by contestants in imperfectly discriminating rent-seeking contests dissipates all or only part of the rent. In particular, we investigate strategic effects, technological effects and asymmetry under an assumption of diminishing returns to...