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Delegation with multiple instruments in a rent-seeking contest

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  • Schoonbeek, Lambert

    (Groningen University)

Abstract

: We consider delegation in a rent-seeking contest with two players, where delegates have more instruments at their disposal than the main players. We endogenize both the decision to hire a delegate and the contingent fee offered to the delegates. We characterize the situations when either no, one or two players hire a delegate in equilibrium. We show that the decision to hire a delegate depends in a non-monotone way on the size of the contested prize.

Suggested Citation

  • Schoonbeek, Lambert, 2006. "Delegation with multiple instruments in a rent-seeking contest," Research Report 06C11, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    • Handle: RePEc:gro:rugsom:06c11
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    File URL: http://irs.ub.rug.nl/ppn/299114678
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    References listed on IDEAS

    as
    1. Baik, Kyung Hwan & Kim, In-Gyu, 1997. "Delegation in contests," European Journal of Political Economy, Elsevier, vol. 13(2), pages 281-298, May.
    2. Liston-Heyes, Catherine, 2001. "Setting the Stakes in Environmental Contests," Journal of Environmental Economics and Management, Elsevier, vol. 41(1), pages 1-12, January.
    3. Kyung Hwan Baik, 2007. "Equilibrium Contingent Compensation in Contests with Delegation," Southern Economic Journal, John Wiley & Sons, vol. 73(4), pages 986-1002, April.
    4. Stefan Szymanski, 2010. "The Economic Design of Sporting Contests," Palgrave Macmillan Books, in: The Comparative Economics of Sport, chapter 1, pages 1-78, Palgrave Macmillan.
    5. Schoonbeek, Lambert, 2004. "Delegation in a group-contest," European Journal of Political Economy, Elsevier, vol. 20(1), pages 263-272, March.
    6. Kyung Hwan Baik, 2007. "Equilibrium Contingent Compensation in Contests with Delegation," Southern Economic Journal, John Wiley & Sons, vol. 73(4), pages 986-1002, April.
    7. Gil S. Epstein & Carsten Hefeker, 2003. "Lobbying contests with alternative instruments," Economics of Governance, Springer, vol. 4(1), pages 81-89, April.
    8. Nitzan, Shmuel, 1994. "Modelling rent-seeking contests," European Journal of Political Economy, Elsevier, vol. 10(1), pages 41-60, May.
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    Cited by:

    1. Rusche, Christian, 2011. "Does Delegation Help to Prevent Spiteful Behavior?," Ruhr Economic Papers 270, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    2. repec:zbw:rwirep:0270 is not listed on IDEAS
    3. Lambert Schoonbeek, 2017. "Information And Endogenous Delegation In A Rent-Seeking Contest," Economic Inquiry, Western Economic Association International, vol. 55(3), pages 1497-1510, July.
    4. Christian Rusche, 2011. "Does Delegation Help to Prevent Spiteful Behavior?," Ruhr Economic Papers 0270, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    5. Park Sung-Hoon & Lee Sanghack, 2019. "How Do Risk-Averse Litigants Set Contingent Fees for Risk-Neutral Lawyers?," Review of Law & Economics, De Gruyter, vol. 15(2), pages 1-19, July.

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