Do too many cooks always spoil the stew? An experimental analysis of rent-seeking and the role of a strategic buyer |
| |
Authors: | Davis Douglas D. Reilly Robert J. |
| |
Affiliation: | 1. Department of Economics, Virginia Commonwealth, University, Richmond, VA, 23284–4000, U.S.A.
|
| |
Abstract: | Laboratory methods are used to evaluate the effects of institutional arrangements and rent-defending activity on rent-seeking auction outcomes. In part, Nash equilibrium predictions are a useful behavioral guide: As predicted, more rents are dissipated in perfectly-discriminating auctions, where the high-bidder wins, than in lotteries, where relative bids determine the chance of winning. Also as predicted, the introduction of a rent-defending buyer reduces social costs. Nevertheless, the social costs of rent-seeking consistently exceed predicted levels. Moreover, individual bidding, especially by buyers, deviates markedly from Nash predictions. |
| |
Keywords: | |
本文献已被 SpringerLink 等数据库收录! |
|