Information and endogenous delegation in a rent-seeking contest

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We offer a new explanation for the occurrence of delegation in rent-seeking contests. We consider a two-player contest for a prize of common value. The players only know that the prize is high or low, with given probabilities. Each player can hire a delegate to act on his behalf. After a delegate is hired, she privately observes the true value of the prize. We derive the conditions under which, respectively, no player, only one player, or both players delegate in equilibrium. (JEL D7)
Original languageEnglish
Pages (from-to)1497-1510
JournalEconomic Inquiry
Issue number3
Early online date2-Mar-2017
Publication statusPublished - 2017

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