Investment in the Absence of Property Rights: The Role of Incumbency Advantages

22 Pages Posted: 12 Jun 2002

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

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Date Written: April 2002

Abstract

In many situations the individuals who can generate some output must enter a contest for appropriating this output. This paper analyses the investment incentives of such agents and the role of incumbency advantages in the contest. Depending on the advantages, an increase in the productivity of the investment can decrease or increase the amount of investment. The results are applied to autocrats' investment behavior and job specific investment in organizations.

Keywords: Investment, Endogenous Property Rights, Contests, Incumbency Advantage, Proprietary States

JEL Classification: D23, D72, D74, H54, O10, P16

Suggested Citation

Konrad, Kai A., Investment in the Absence of Property Rights: The Role of Incumbency Advantages (April 2002). Available at SSRN: https://ssrn.com/abstract=311964

Kai A. Konrad (Contact Author)

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

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Germany

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

Centre for Economic Policy Research (CEPR)

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

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Munich, 81679
Germany

IZA Institute of Labor Economics

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Bonn, 53072
Germany

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