Researchers have proposed various theories to explain overbidding in rentseeking contents, including mistakes, systematic biases, the utility of winning, and relative payoff maximization. Through an eight-part experiment, we test and find significant support for the existing theories. Also, we discover some new explanations based on cognitive ability and impulsive behavior. Out of all explanati...

We study how norms can solve distributional conflict inside a clan and the efficient coordination of collective action in a conflict with an external enemy. We characterize a fully non-cooperative equilibrium in a finite game in which a self-enforcing norm coordinates the members on efficient collective action and on a peaceful distribution of the returns of collective action. JEL Classificatio...

We show that the optimal prize structure of symmetric n-player Tullock tournaments assigns the entire prize pool to the winner, provided that a symmetric pure strategy equilibrium exists. If such an equilibrium fails to exist under the winner-take-all structure, we construct the optimal prize structure which improves existence conditions by dampening efforts. If no such optimal equilibrium exis...

Political principals typically use low-cost ‘‘fire-alarm’’ signals transmitted by the media, interest groups, and disaffected constituents to monitor the activities of regulatory agencies. We argue that regulatory decision making is biased and inconsistent if the instruments of political oversight are simple and the information flows to the principal are coarse relative to the complexity of the...

This note characterizes the ‘inverse plurality rule’, where voters specify only their least preferred alternative. This rule is characterized by a new minimal veto condition (MV) and the four well known conditions that characterize scoring rules; namely, Anonymity (A), Neutrality (N), Reinforcement (RE) and Continuity (C). Our new characterization result is related to the characterizations of a...

Using a long panel of roll call voting data, I find that “flip-flopping” senators face significant electoral costs when changing positions. In models of electoral competition, as the costs to candidates changing position approach zero, the equilibrium prediction is the convergence of platforms. Such convergence is at odds with empirical observation. Using a dynamic, structural model of candidat...

In this paper we present a generalization of power indices which includes the preferences of the voters. Using a Multilinear Extension perspective (Owen, 1972a) we measure the probability of the players’ voting ’yes’ for a particular political issue. Further, we randomize the issues and show the influence that the Agenda Setter can have on a player’s power. We demonstrate these results using da...

This paper analyzes an overlapping generation model of public good provision under repeated voting. The public good is financed through age-dependent taxation that distorts human capital investment. Taxes redistribute income both across different skill groups and across generations. We contrast the political equilibria with the Ramsey allocation, and analyze the sources of inefficiency. The pol...

When politicians are provided with insufficient incentives by the democratic election mechanism, we show that social welfare can be improved by threshold contracts. A threshold incentive contract stipulates a performance level which a politican must reach in order to have the right to stand for reelection. Read my lips would turn into read my contracts. Reelection thresholds can be offered by p...