Title: Rent-seeking contests with private valuations
Abstract: We study a rent-seeking contest in which players have heterogeneous and private valuations. In addition to their own type, agents only know that all valuations are drawn from an unspeciÂ…ed distribution, of which they only know the mean. We obtain a closed-form solution for agentsÂ’ optimal level of investment and subject it to comparative statics analy- sis. We also investigate the issue of entry in the game and the amount of rent dissipation that results in equilibrium. Finally, we compare our results with those that would emerge in a context of perfect information.
Publication Year: 2014
Publication Date: 2014-01-01
Language: en
Type: preprint
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