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Cooperation by way of support in a rent seeking contest for a public good
Authors:Bouwe R Dijkstra
Institution:Faculty of Law, Department of Economics, University of Groningen, PO Box 716, NL-9700 AS Groningen, Netherlands
Abstract:This paper analyzes the efforts made to influence a decision that can have two outcomes. First, the agents on the same side designate an agent to play the contest for them. The inactive agents can then decide to support this active agent, i.e. pay a percentage of his effort. It is optimal to designate either the agent with the lowest stake (who will receive support from everyone else) or the agent with the highest stake (who will not receive support) as the active agent. We find that the side with the higher aggregate stake may have the lower success probability.
Keywords:Rent seeking contest  Cooperation  Delegation
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