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Münster, Johannes (January 2006): Rents, dissipation and lost treasures: comment. SFB/TR 15 Discussion Paper No. 119 [PDF, 763kB]


In an interesting recent paper, Dari-Mattiacci and Parisi (2005) extended Tullock.s (1980) rent-seeking game with an entry decision. The mixed strategies identified by Dari-Mattiacci and Parisi for the case of increasing returns in the contest success function (r > 2) do not constitute an equilibrium of the game they study. However, these strategies are an equilibrium if the strategy space of the game is restricted by a minimum expenditure requirement, and this minimum expenditure requirement is an element of a specific interval.

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