Title: An approximate solution to rent-seeking contests with private information
Abstract: We propose an approximate solution to rent-seeking contests in which participants have heterogeneous and private valuations. The procedure only requires common knowledge about the mean of the distribution of valuations. We obtain a closed-form expression for an agent’s level of investment and subject it to comparative statics analysis. We then assess the performance of the model and find that the proposed solution provides a remarkably effective approximation of the optimal solution for a wide range of parameter specifications.
Publication Year: 2016
Publication Date: 2016-07-26
Language: en
Type: article
Indexed In: ['crossref']
Access and Citation
Cited By Count: 7
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