Corruption and Rent-Seeking

The rent-seeking theory was one of thefirst economic instruments developed tomodel corruption in the public sector.Comparing corruption with lobbying, itproposes that the former is the lesser oftwo evils, since lobbying entails the wastage of resources inthe competition forpreferential treatment. This study showsthat the traditional rent-seeking theorymisunderstands three factors: first, theimpact of a corrupt monopoly on the rent'ssize; second, corruption as a motivationfor supplying preferential treatment andthird; that corruption involves a narrowerrange of interests than those ofcompetitive lobbying. Taking these factorsinto consideration, the opposite argumentis valid: corruption has worse welfareimplications than alternative rent-seekingactivities.     

Lottery Versus All-Pay Auction Models of Lobbying

I first provide a complete characterizationof the unique equilibrium of thelottery game by n lobbyists with asymmetricvaluations, and then compare the lotteryand the all-pay auction models of lobbying.I show that the exclusion principlediscovered by Baye, Kovenock and de Vries(1993) for all-pay auction does not applyto lottery. I also show that the perverse effectthat an exogenous cap may increase thetotal lobbying expenditure in a two-bidderall-pay auction discovered by Che and Gale(1998) does not apply to lottery.     

Efficient Rent-Seeking in Experiment

In a series of experiments we show that people learn to playthe efficient outcome in an open-ended rent-seeking game. Thisresult persists despite quite different experimentenvironments and designs, like different propensities ofcompetition, group sizes etc., and is interpretable as aresolution of the so-called Tullock paradox which states thatreal-world rent-seeking expenditures are much lower than whatthe standard rent-seeking model predicts.     

Stakes and Welfare in Rent-Seeking Contests

Using a public-policy application ofTullock's two-player rent-seeking contest,this paper focuses on the relationshipbetween the aggregate expected utility ofthe players and their asymmetricvaluations. In our game these valuationsare the players' payoffs in the twopossible states of nature, namely, theapproval and rejection of the proposedpublic policy. Our main result provides thecondition that ensures that the aggregateexpected payoff of the two contestants (theinterest groups that compete on theapproval of the proposed policy) is positively related to the valuationparameters.     

Two-Stage Rent-Seeking Contests with Carryovers

We examine a two-stage contest in which players in twogroups compete noncooperatively to win a rent. In thefirst stage, each group selects a finalist. The twofinalists compete for the rent in the second stage.First-stage efforts are carried over to the secondstage in the sense that they are partly effective inthe second stage as well. We show the following. Inthe case of player-specific carryovers, therent-dissipation rate increases in the carryover rate.With the carryover rate equal to one, the rent isfully dissipated. In the case of group-specificcarryovers, however, the rent-dissipation rate isindependent of the carryover rate.     

Committees and Rent-Seeking Effort under Probabilistic Voting

Congleton (1984) shows that a rent awardedby a committee results in smaller aggregaterent-seeking expenditures than a similarrent awarded by a single administrator.This note modifies Congleton's model byconsidering a model in which voting isprobabilistic instead of deterministic. Ishow that the relative magnitudes ofrent-seeking expenditures could go eitherway depending on the relative weightedsensitivities (to rent-seeking efforts) ofthe committee and the single administrator.I show how the distribution of votingpowers of committee members affectsrent-seeking efforts. I also examine thecase where there is some probability thatthe rent may not be awarded, if thecommittee is unable to reach a majoritydecision. My results diverge from Congleton(1984) because of the absence ofmajoritarian cycles in my model.     

Asymmetric Rent-Seeking with More than Two Contestants

This article considers a rent-seeking model with N asymmetriccontestants. Each contestant may have a different valuation ofthe rent or a different relative ability to win the rent. Oneof the N contestants is selected as the winner based onTullock's probabilistic contest rule with constant returns toscale. A pure strategy Nash equilibrium solution is obtainedand its consequences are investigated.     

What's Yours is Mine: Rent-Seeking and the Common Law

The paper develops a rent-seeking theory of the common law.The general finding is that the law's form depends on thecomparative advantage each group has in production versusappropriation generally, and appropriation via litigation inparticular. The model generates new interpretations ofdevelopments in United States common law, and is used both tosupplement and to criticize two dominant theories of such law,the efficiency theory associated with the law and economicsmovement and that generated by critical legal studiesscholars.     

Some Implications of Corporate Taxation for Rent-Seeking Activity

In this paper we show that corporate taxes are likely to have considerable implications for rent-seeking activity. We find that corporate taxation tends to significantly reduce rent-seeking, and that it favors rent-seeking by established firms and discriminates against new and zero profit firms. Indeed, we show that corporate tax regulations may completely block rent-seeking by new corporations, and that rent-seeking competitions may be characterized by an equilibrium that features a small number of profitable and well established firms. Tax regulations may therefore impart an oligopolistic tendency to rent-seeking markets. Moreover, our results may have significant implications for the effects of corporate taxes on patent races, tournaments, and other first-past-the-post competitions.     

Decision by Sortition: A Means to Reduce Rent-Seeking

This essay gives an overview of how arandomized decision mechanism (sortition)can be expected to reduce the intensity ofself-interested activity by rent-seekingfactions within democracies. The socialcosts of rent-seeking are briefly reviewed.I then make the case that randomization ofcollective decision making proceduresattenuates rent-seeking expenditures. Iillustrate the argument by reference to thehighly contested Presidential election of2000. Finally, I buttress that argument bycomparing plurality voting and sortitionwithin the context of Tullock's Efficient Rent-seeking model (1980).     

Improper Selection of High-Cost Producers in the Rent-Seeking Contest

The resources two rival businesses spend to raise their own chanceof getting a unique monopoly license are a cost of rent-seeking.When those businesses differ in the costs of producing themonopoly good there is an additional cost of rent-seeking that hasnot been sufficiently studied in the literature. If the high cost producer winsthe license, the difference between his cost and the costs of hismore efficient rival is a social loss from improper selection ofproducers by the political process. The loss becomes more severewhen the ability to lobby of the inefficient producer outstripsthat of the efficient producer. This may help to explain whyspecialized lobbying evolved. Specialized lobbying reduces thesocial cost from improper selection of firms by allowing efficientproducers to hire expert rent-seekers and so to raise theirchances of gaining monopoly concessions.     

Asymmetric Two-Stage Group Rent-Seeking: Comparison of Two Contest Structures

Two variations of a two-stage rent-seeking contest areconsidered. In the first stage of the Between-Groupmodel, groups compete through the expenditure of resources bytheir members. Based on group expenditures, one winning groupis probabilistically determined. On the second stage, membersof the winning group compete with one another for an exogenousprize. In the Semi-Finals model a player is chosen fromeach group and then these players compete for the prize.Groups differ in size or in their valuation of the prize.Subgame-perfect equilibrium solutions are constructed forthese two contest structures.     

The Case for Regulatory Rent-Seeking: CRA Based Protests of Bank Mergers and Acquisitions

This paper addresses the question of regulatory rent seekingbased on protests of proposed bank mergers and acquisitionssubmitted by community groups to bank regulators. Theories ofCRA-related community group behavior based on benevolence andrent seeking, yield significantly different implicationsconcerning the effect of a bank's CRA rating on protestprobability, allowing for a clear test of the underlyingmotive for protest activity. The analysis shows: (1) protestsimpose significant time cost on merger and acquisitionapplications and (2) the benevolent-based theory must berejected in favor of the rent-seeking theory.     

Peace and Conflict: Alternative Strategies of Governance and Conflict Resolution

This article examines the present discourse of conflict resolution and offers an alternative framework for analyzing the generic sources of conflict at the community, state, and interstate levels. In particular, we argue that although peace is a universal value, there are no universally best strategies to achieve it. This, however, does not mean that the path to peace is fundamentally different in every context. We claim that stable democratic political structures in general lead to peace both in the international and the domestic realms. As such, democratization does lead to peace, but the paths to stable democracy are context sensitive. Therefore, the success of efforts aimed at creating long-term peace, both among and within nations, depends on the extent to which, democratization incorporates the norms and values of the societies in question. The article begins with a brief overview of some of the problems associated with defining peace. We suggest that peace should be looked at as a universal value, as democracy has been in the recent past. We provide a more detailed theoretical assessment of the linkage between democracy and peace. Our general argument is illustrated in the South Asian, specifically the Indian, context.     

Reputation and Interstate Conflict

In international politics, states learn from the behavior of other nations, including the reputations states form through their actions in the international system. This article presents a model of how states process this information and examines how this learning affects international conflict. The model builds off of cognitive balance theory and foreign policy learning models and breaks new ground in its ability to provide a contextual assessment of reputation in world politics. The article then investigates whether a dyad is more likely to experience conflict if at least one state has a reputation for hostility. This hypothesis is tested empirically across all dyads in the international system from 1817 to 2000. The results indicate that states do engage in this learning behavior and that the information generated by extra-dyadic interaction of states has a significant bearing upon the likelihood of dyadic conflict .     

社会冲突与社会整合

转型期是社会结构不断分化的时期,也是冲突的多发期.社会整合是化解社会冲突的主要途径,面对新型社会冲突的挑战,需要实现社会整合方式的转变,在利益整合的基础之上,全面调动、发挥社会各种力量在社会整合与和谐社会构建中的作用.通过多元化复合整合走向和谐社会     

Value Conflict and Policy Change

The analysis of policy change has produced a number of contrasting theoretical approaches, each offering a lens through which to view policy phenomena. This article suggests that the existing menu of approaches for understanding change can be usefully complemented by an understanding of the role played by value conflict. Using institutionalist analysis, I argue that the need to make value‐choices in a nondisruptive way shapes large areas of government activity, particularly in Westminster systems, and explains many observed patterns of stability and change. Building on work by Thacher and Rein, I describe and characterize six types of response to value conflict, giving examples of the role and implications of each. It is not claimed that all policy change can be understood in this way—simply that some types of change reflect the value‐based nature of public policy itself, and the fact that political and bureaucratic systems must evolve mechanisms for dealing simultaneously with thousands of competing and conflicting policy values.     

Conflict Avoidance and Political Participation

Previous explanations of mass participation have often focused on sociodemographic characteristics to the neglect of social psychological factors. This study takes a new path in thinking about the role of psychological factors in participation. Specifically, we hypothesize that individual propensities regarding conflict will influence the likelihood of participating in political affairs. We develop more specific expectations for how the avenue of participation interacts with individual propensities toward conflict to influence participation. Using secondary analysis of the Citizen Participation Study (CPS), we show that conflict avoidance is significantly and inversely related to participation in some kinds of activities, consistent with our expectations. Thus, both individual propensities and the political context influence participation. This study provides a new understanding of which individuals participate in political affairs and which avenues they choose. This suggests a need to reconsider the role of psychological factors in models of participation.