Dynamic Contests

WZB Markets and Politics Working Paper No. SP II 2010-10

24 Pages Posted: 25 Oct 2010

See all articles by Kai A. Konrad

Kai A. Konrad

Max Planck Institute for Tax Law and Public Finance; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute for Economic Research); IZA Institute of Labor Economics

Date Written: October 22, 2010

Abstract

Considering several main types of dynamic contests (the race, the tug-of-war, elimination contests and iterated incumbency fights) we identify a common pattern: the discouragement effect. This effect explains why the sum of rentseeking efforts often falls considerably short of the prize that is at stake. It may cause violent conflict in early rounds, but may also lead to long periods of peaceful interaction.

Keywords: Contest, dynamic conflict, discouragement effect, race, tug-of-war, elimination contest, iterated incumbency fight

JEL Classification: D71, D74

Suggested Citation

Konrad, Kai A., Dynamic Contests (October 22, 2010). WZB Markets and Politics Working Paper No. SP II 2010-10 , Available at SSRN: https://ssrn.com/abstract=1695939 or http://dx.doi.org/10.2139/ssrn.1695939

Kai A. Konrad (Contact Author)

Max Planck Institute for Tax Law and Public Finance ( email )

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Munich, 80539
Germany

HOME PAGE: http://www.tax.mpg.de/en/pub/home.cfm

Centre for Economic Policy Research (CEPR)

90-98 Goswell Road
London, EC1V 7RR
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

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Munich, 81679
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, 53072
Germany

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