A substantial number of regulatory frameworks are commonly viewed by impartial observers as inordinately complex. Is there an explanation for this phenomenon? Employing a partial equilibrium model, this paper approaches the problem of complexity from a political-economy vantage point. It...

The compromise enhancing effect of lobbying on public policy has been established in two typical settings. In the first, lobbies are assumed to act as 'principals' and the setters of the policy (the candidates in a Downsian electoral competition or the elected policy maker in a citizen-...

By the well established tournament literature, incomplete information regarding the employees? productivity is essential for the rationalization of (efficiency-enhancing) tournaments. In this paper we propose an alternative rationalization of tournaments focusing on a fully informed principal...

In this paper we study the endogenous determination of minimum wage employing a political-economic game-theoretic approach. A major objective of the paper is to clarify the crucial role of the strength of the workers? union and of political culture on the determination of the minimum wage. In...

In this paper we analyze the endogenous determination of migration quota viewing it as an outcome of a two-stage political struggle between two interest groups: those in favor and those against the proposed migration quota. We first compare the proposed policies of the two interest groups under...

This paper focuses on indivisible multiple-costsingle-benefit projects that must be approved by the government. A simple mechanism is proposed that ensures an efficient and fair implementation of such projects. The proposed mechanism is appropriate for a unilateral information structure: the...

Many economic and political decisions are the outcome of strategic contests for a given prize. The nature of such contests can be determined by a designer who is driven by political considerations with a specific political culture. The main objective of this study is to analyze the effect of...

Collective contests are examined permitting heterogeneity of stakes within every competing group. Our first concern is whether unequal distribution of stakes in a group can enhance its win probability. Our second concern is whether a large stake in a group can be individually disadvantageous. We...

This paper proposes a new model of market structure determination. It demonstrates that market structure need not be the result of ideology, political power, collusion among producers or the nature of the technology. In our setting, it is determined by bureaucrats who maximize their share of the...

This paper evaluates direct and structural discrimination as a means of increasing efforts in the most widely studied contests. We establish that a designer who maximizes efforts subject to a balanced-budget constraint prefers dual discrimination, namely, change of the contestants' prize...