the solution to the tullock rent seeking game when r 2 mixed strategy equilibria and mean dissipation rates in tullock s rent seeking model the probability a player wins the game depends on expenditures raised to the power r we show that a symmetric mixed strategy nash equilibrium exists when r 2 and that overdissipation of rents does not arise in any nash equilibrium we derive a tight lower bound on the level of rent dissipation that arises in a symmetric equilibrium when the strategy space is discrete and show that full rent dissipation occurs when the strategy space is continuous our results are shown to be consistent with recent experimental evidence on the dissipation of rents

price and income elasticities of crude oil import demand in south africa a cointegration analysis abstract this paper examines the demand for imported crude oil in south africa as a function of real income and the price of crude oil over the period 1980 2006 we carried out the johansen co integration multivariate analysis to determine the long run income and price elasticities a unique long run cointegration relationship exists between crude oil imports and the explanatory variables the short run dynamics are estimated by specifying a general error correction model the estimated long run price and income elasticities of 0 147 and 0 429 suggest that import demand for crude oil is price and income inelastic there is also evidence of unidirectional long run causality running from real gdp to crude oil imports

incomplete information and rent dissipation in deterministic contests abstract in a deterministic contest or all pay auction all rents are dissipated when information is complete and contestants are identical as one contestant becomes stronger that is values the prize more total expenditures are known to decrease monotonically thus asymmetry among contestants reduces competition and rent dissipation recently this result has been shown to hold for other non deterministic contest success functions as well thereby suggesting a certain robustness in this paper however the complete information assumption is shown to be crucial i examine a tractable incomplete information model for which the complete information model is a special case with incomplete information regardless of how little total expenditures in a deterministic two player contest increase when one contestant becomes marginally stronger starting from a symmetric contest in fact both contestants expend resources more aggressively with complete information neither of them do so thus there is a discontinuity in the information structure

rent seeking and rent dissipation a neutrality result abstract we consider rent seeking contests between at least two agents who might value the prize differently we capture a wide range of institutional aspects of contests by analyzing a class of contest success functions fulfilling several properties the main properties are anonymity and a condition on the elasticity of a rent seeker s win probability with respect to her effort we show the existence of a mixed strategy equilibrium and establish equilibrium payoffs in this equilibrium complete rent dissipation holds our results imply a partial robustness result for the all pay auction

determinants of import demand for non renewable energy petroleum products empirical evidence from nigeria abstract this study estimated determinants of import demand for refined petroleum products in nigeria for the period 1984 2013 it employed the autoregressive distributed lag ardl bounds test cointegration method and analysed both long run and short run determinants of import demand for total and specific petroleum products in the long run aggregate and sectoral incomes are significant determinants of import of refined kerosene further real effective exchange rate reer aggregate income gdp manufacturing sector s income domestic energy production dep and population growth rate pgr are drivers of import of refined motor spirit moreover reer dep and manufacturing sector s income are propellers of import of refined distillate fuel also reer and total output of petroleum products are major drivers of total import of refined petroleum products short run results show that previous period gdp pgr and manufacturing and service sectors incomes are determinants of import demand for refined kerosene moreover reer gdp previous pgr and manufacturing sector s income exert significant effects on the import of refined motor spirit further significant effects of reer dep previous pgr domestic output of the product and manufacturing and service sectors incomes on the import demand for distillate fuel were found policy implications of the foregoing are articulated in the paper

winner take all and proportional prize contests theory and experimental results abstract this study provides a unified framework to compare three canonical types of contests winner take all contests won by the best performer winner take all lotteries where probability of success is proportional to performance and proportional prize contests in which rewards are shared in proportion to performance we derive equilibria and observe outcomes from each contest in a laboratory experiment equilibrium and observed efforts are highest in winner take all contests lotteries and proportional prize contests have the same nash equilibrium but empirically lotteries induce higher efforts and lower more unequal payoffs behavioral deviations from theoretical benchmarks in different contests are caused by the same underlying attributes such as risk aversion and the utility of winning finally we find that subjects exhibit consistent behavior across different types of contests with subjects exerting higher effort in one contest also exerting higher effort in another contest

an empirical analysis of petroleum demand for indonesia an application of the cointegration approach this paper uses selection criteria from various models in a bounds testing approach to cointegration to estimate the price and income elasticities of demand for total petroleum products gasoline and diesel and gasoline share in total products in indonesia the results suggest that both total products and gasoline share estimates are more responsive to changes in income than changes in the real price of petroleum products these results have important policy implications as they suggest that policy makers may need to use market based pricing policies and other policies such as public enlightenment in addition to regulations like minimum energy efficiency standards to promote efficiency and conservation and curb the rising consumption of petroleum products in indonesia

where are all the self employed women push and pull factors influencing female labor market decisions previous research focuses on factors that influence self employment participation in part because entrepreneurship has been associated with economic growth this literature has tended to focus only on men or the comparison of women to men while ignoring substantial heterogeneity in employment decisions among women by investigating the impact of individual household and local economic and cultural characteristics on the labor market outcomes of different groups of women we get a more comprehensive picture of their self employment decision recognizing self employment as one of multiple labor market choices we use multinomial logit and two confidential geocoded micro level datasets to study women s career choices in urban areas we find that the effects of various push and pull factors differ between married and unmarried women in particular more progressive gender attitudes pull married women into self employment while household burdens associated with children push them into self employment for unmarried women the local business climate and individual characteristics have the strongest influence in both cases the motivations for women are quite different than men

gender as a determinant of small business performance insights from a british study the performance of small businesses that is the ability of small firms to contribute to job and wealth creation through business start up survival and growth has been an important area of policy and academic debate in the 1980s surprisingly little has been written about gender and small business performance our literature search revealed only a small number of studies of any substance on this subject though over forty made some mention of it most studies shied away from direct examination of quantitative performance measures such as jobs created sales turnover annual growth tending to concentrate on qualitative measures of success or failure the paper examines small business performance and gender using data obtained from a survey of 600 300 women 300 men scottish and english small business ownermanagers part of a three year study on the impact of gender on small business management analyses suggest that the relationship between gender and small business performance is complex but that gender still appears to be a significant determinant even after other key factors are controlled for

contests with small noise and the robustness of the all pay auction this paper considers all pay contests in which the relationship between bids and allocations reflects a small amount of noise prior work had focused on one particular equilibrium however there may be other equilibria to address this issue we introduce a new and intuitive measure for the proximity to the all pay auction this allows in particular to provide simple conditions under which actually any equilibrium of the contest is both payoff equivalent and revenue equivalent to the unique equilibrium of the corresponding all pay auction the results are shown to have powerful implications for monopoly licensing political lobbying electoral competition optimally biased contests the empirical analysis of rent seeking and dynamic contests

how does motherhood affect self employment performance this paper analyzes the timing between self employment entry and first child birth among swedish women using register data for the cohort of women born between 1970 and 1975 we use longitudinal d

primaries and the new hampshire effect candidates for u s presidential elections are determined through sequential elections in single states the primaries we develop a model in which candidates can influence their winning probability in electoral districts by spending money on campaigning the equilibrium replicates several stylized facts very well campaigning is very intensive in the first district the outcome of the first election then creates an asymmetry in the candidates incentives to campaign in the next district which endogenously increases the equilibrium probability that the first winner wins in further districts on the normative side our model oers a possible explanation for the sequential organization it leads in expectation to a lower level of advertising expenditures than simultaneous elections moreover if one of the candidates is the more eective campaigner sequential elections also perform better with regard to the selection of the best candidate

business borrowing and control a theory of entrepreneurial types a formal model of the bank borrowing decision by the small firm is provided to explain why some entrepreneurs borrow and others do not and why some businesses grow and others remain stationary over long periods loan capital is productive and increases the firm s revenue but brings the business under the control of the bank profits generated by borrowing are a good increasing owner utility whereas control is a bad reducing it the consequent tradeoff between borrowing and control implies that the business optimum will involve borrowing less than the amount that maximises profits if owner control aversion is strong enough equilibrium may involve a corner solution with the business being entirely self funding the above result holds under conditions of symmetric information and zero credit rationing dynamic analysis distinguishes one group of entrepreneurs movers whose preferences towards control evolve through time and their control aversion diminishes from another group stayers whose preferences remain stationary for the movers borrowing increases over time up to a profit maximising optimum whereas for the stayers independence of control is maintained but at the expense of non growth

contest functions theoretical foundations and issues in estimation contest functions alternatively contest success functions determine probabilities of winning and losing as a function of contestants e ort they are used widely in many areas of economics that employ contest games from tournaments and rent seeking to conflict and sports we first examine the theoretical foundations of contest functions and classify them into four types of derivation stochastic axiomatic optimally derived and microfounded the additive form which includes the ratio or tullock functional form can be derived in all four di erent ways we also explore issues in the econometric estimation of contest functions including concerns with data endogeneity and model comparison

employment change in independent owner managed high technology firms in great britain there is a growing volume of literature that points to the potential for small technology based firms to achieve substantial employment growth as a direct consequence of such work this sector of any economy has attracted increasing attention from national and local governments concerned with finding ways of revitalising economically deprived localities and creating employment opportunities this paper provides up to date empirical evidence surrounding the ability of small high technology firms to create additional jobs in great britain in addition key founder and business characteristics are isolated which are significantly associated with employment change in growing high technology firms over the 1986 to 1992 period with respect to factors influencing these high levels of employment growth a high firm size in 1986 was found to act positively on employment growth as was a graduate level education for the key founder on the finance side firms which had access to and used a multiplicity of sources of start up finance tended to grow faster futher on the basis of our results we would suggest and recommend a government policy which at the firm level actively encourages high technology firm start ups who record higher rates of survival than firms in more conventional sectors as well as providing support for existing high technology firms who have already demonstrated the inclination and ability to grow in employment size

testing the female underperformance hypothesis most previous studies have found evidence at the aggregate level that female entrepreneurs underperform relative to their male counterparts this study conducts a comprehensive test of this finding the test is conducted on a large swedish sample of 4200 entrepreneurs 405 females with 1 to 20 employees in all sectors of the economy our study confirms the results of several previous studies that female entrepreneurs tend to underperform relative to men when the data is examined at the most aggregate level at the same time our data reveals sharp structural differences between male and female entrepreneurs in an extensive multi variate regression with a large number of controls it turns out that female underperformance disappears for three out of four performance variables the only exception is sales no gender difference is found for profitability a more detailed analysis reveals that the evidence of female underperformance is much weaker in larger firms and nonexistent in firms with only one employee if it is true that female entrepreneurs on average have weaker preferences for sales growth while we consistently find that they do not underperform in terms of profitability our study provides no support for female underperformance given differences in preferences

disclosure policy in tullock contests with asymmetric stochastic entry we examine how disclosure policy can be optimally designed to incentivize contestants when their participation is exogenously stochastic in a generalized tullock contest setting with two players who are asymmetric in both their values and entry probabilities we fully characterize the necessary and sufficient conditions under which no disclosure dominates full disclosure we find that the comparison depends solely on a balance effect exercised by entry probabilities on the expected total effort the optimal disclosure policy must better balance the competition these conditions continue to hold when the precision r of tullock contests is endogenously chosen by the designer

asymmetric treatment of identical agents in teams abstract we investigate when identical agents will be treated asymmetrically in a simple team setting asymmetric treatment is optimal when the agents individual contributions to team performance are strategic complements symmetric treatment of identical agents is optimal when the agents contributions are strategic substitutes or when they are independent

determinants of microenterprise performance in nepal although the literature on entrepreneurship studies has contributed significantly in improving our insights regarding the factors determining the enterprise performance in a broader sense there has been a little research concerning the factors determining the microenterprise performance using primary data enumerated from 501 micro entrepreneurs randomly sampled across different strata gender caste ethnicity enterprise category and ecological belts in nepal in 2013 for the years 2068 bs april 2011 march 2012 and 2069 bs april 2012 march 2013 and executing the multiple linear regression models the study primarily focused on identifying the factors determining the microenterprise performance the study revealed that the entrepreneur related factors particularly gender managerial skills need for achievement need for autonomy creative tendency internal locus of control and managerial foresight enterprise related factors particularly enterprise age enterprise size and initial financial constraint and environment related factor particularly social network were the key factors determining the performance of microenterprises in nepal

does more mean worse three decades of enterprise policy in the tees valley this paper argues that there have been three distinct phases of enterprise policy in the uk in the past 30 years the 1970s saw no effective enterprise policy policy off the 1980s witnessed an attempt to increase the number of start ups and the 1990s saw a concentration on business quality this paper looks at how enterprise has evolved in cleveland tees valley over the past three decades it suggests and finds that businesses in the 1980s were more numerous but of lower quality even if the influence of unemployment is accounted for than those from the 1970s and 1990s this implies that we should be cautious about the value of policy attempts to increase business formation rates in areas such as cleveland tees valley

difference form contests and the robustness of all pay auctions abstract in much of the existing literature on rent seeking games the outcome of the contest is either infinitely sensitive or relatively insensitive to contestants efforts the current paper presents a family of contest games that permit characterization of equilibrium for all levels of sensitivity of the outcome to contestants efforts specifically the outcome of the contest depends on the difference between efforts which encompass the lottery and the all pay auction as polar cases the equilibrium converges to that of the all pay auction as the probability of winning the prize grows infinitely sensitive to one s effort and the main qualitative features of equilibrium persist over a large parameter region journal of economic literature classification numbers d44 d72

the demand for gasoline in south africa an empirical analysis using co integration techniques abstract using the recently developed autoregressive distributed lag ardl bound testing approach to co integration suggested by pesaran et al pesaran m h shin y smith r j bounds testing approaches to the analysis of level relationships journal of applied econometrics 2001 16 3 289 326 we empirically analyzed the long run relationship among the variables in the aggregate gasoline demand function over the period 1978 2005 our study confirms the existence of a co integrating relationship the estimated price and income elasticities of 0 47 and 0 36 imply that gasoline demand in south africa is price and income inelastic

elections with platform and valence competition abstract we study a game in which candidates first choose platforms and then invest in costly valences e g engage in campaign spending the marginal return to valence depends on platform polarization the closer platforms are the more valence affects the election outcome consequently candidates without policy preferences choose divergent platforms to soften valence competition moreover exogenous increases in incentives for valence accumulation lead to both increased valence and increased polarization the latter because candidates seek to avoid the costs of extra valence as a result the increase in valence is smaller than it would have been with exogenous platforms finally the model highlights the overlooked substantive importance of common modeling assumptions changing the source of uncertainty in our model from noise around the median voter s ideal point to a shock to one candidate s valence as is common in the literature leads to complete platform convergence for all parameter values

entry into winner take all and proportional prize contests an experimental study this experiment compares the performance of two contest designs a standard winner take all tournament with a single fixed prize and a novel proportional payment design in which that same prize is divided among contestants by their share of total achievement we find that proportional prizes elicit more entry and more total achievement than the winner take all tournament the proportional prize contest performs better by limiting the degree to which heterogeneity among contestants discourages weaker entrants without altering the performance of stronger entrants these findings could inform the design of contests for technological and other improvements which are widely used by governments and philanthropic donors to elicit more effort on targeted economic and technological development activities

multi battle contests abstract we study equilibrium in a multistage race in which players compete in a sequence of simultaneous move component contests players may win a prize for winning each component contest as well as a prize for winning the overall race each component contest is an all pay auction with complete information we characterize the unique subgame perfect equilibrium analytically and demonstrate that it exhibits endogenous uncertainty even a large lead by one player does not fully discourage the other player and each feasible state is reached with positive probability in equilibrium pervasiveness expected effort in the component contests may be non monotonic in the closeness of the race and realized individual effort may exceed the value of the prize by a factor that is proportional to the maximum number of stage victories required

information in conflicts abstract we consider two player contests for a prize of common but uncertain value for settings where one player knows the value of the prize while the other only knows its prior distribution we give conditions for when the uninformed agent is ex ante strictly more likely to win the prize than is the informed agent in the special case of a lottery contest equilibrium expenditures are lower under asymmetric information than if either both agents are informed or neither agent is informed

entrepreneurial characteristics and the size of the new firm a model and an econometric test this paper examines entrepreneurial influences on the size of the new firm theory and previous empirical research indicate that the entrepreneurial attributes most likely to influence the characteristics and performance of new firms are motivation workskills and information the results of a regression analysis confirm these hypotheses when turnover and total assets are the dependent variables but are less conclusive when employment is the dependent variable possibly the most interesting finding is that the entrepreneurs who create the most jobs are those who are highly motivated have managerial skills and whose firms are in the manufacturing sector

failure or voluntary exit reassessing the female underperformance hypothesis abstract we reevaluate the female underperformance hypothesis by challenging the assumption that female owned ventures are more likely to fail instead of equating exit with failure we draw on exit literature and feminist theories to argue that female entrepreneurs are actually more likely than males to exit voluntarily we argue for further gender differences by using an even more fine grained conceptualization of entrepreneurial exit failure exit for personal reasons and exit for other professional financial opportunities post hoc analyses also point to within gender heterogeneity depending on family status a sample probe of 219 spanish entrepreneurs who had exited their business supports our overall reasoning

rigging the lobbying process an application of the all pay auction textabstractin a world where a politician can explicitly auction off a prize to the high bidder the standard auction literature can be used to analyse political behavior the justice system however precludes politicians from explicitly selling the prize to the highest bidder thus politicians cannot let it become public knowledge that they are in the business of selling political favors an institution has emerged in political markets to overcome this constraint which are termed as lobbying lobbyists make implicit payments to the politician through campaign contributions if these up front payments were rebated to those failing to receive the prize it would be clear that the politician was selling favors this article has examined an interesting principle arising in all pay auctions this principle states that a politician wishing to maximize political rents may find it in his best interest to exclude certain lobbyists from participating in the lobbying process particularly lobbyists valuing most the political prize

conflict and rent seeking success functions ratio vs difference models of relative success the rent seeking competitions studied by economists fall within a much broader category of conflict interactions that also includes military combats election campaigns industrial disputes lawsuits and sibling rivalries in the rent seeking literature each party s success pi which can be interpreted either as the probability of victory or as the proportion of the prize won has usually been taken to be a function of the ratio of the respective resource commitments alternatively however pi may instead be a function of the difference between the parties commitments to the contest the contest success function csf for the difference from is a logistic curve in which as is consistent with military experience increasing returns apply up to an inflection point at equal resource commitments a crucial flaw of the traditional ratio model is that neither onesided submission nor two sided peace between the parties can ever occur as a cournot equilibrium in contrast both of these outcomes are entirely consistent with a model in which success is a function of the difference between the parties resource commitments

my first employee an empirical investigation the challenge for solo entrepreneurs to add their first employee is arguably the single biggest growth event facing any growing firm to understand how this event affects performance and the antecedents of hiring we analyse danish matched employer employee data those who hire enjoy superior sales outcomes in subsequent years while the dispersion in profits increases furthermore those that hire enjoy faster sales growth in the previous year suggesting that sales growth precedes the first hire finally we show that founders with a stronger profile in terms of education and previous income are more likely to increase profits while the characteristics of the employee are less important the latter finding is important from a job creation perspective in light of the suggested sorting of more marginalized employees into new and established firms

being in someone else s shoes the role of gender in nascent entrepreneurship several studies have shown the existence of significant differences in the rate of new business creation between men and women specifically it has been shown that women are much less likely to be involved in entrepreneurship than men worldwide it is not yet understood however if such differences are the result of personal characteristics of the individual and of her economic environment or are instead the result of universal and perhaps evolutionary phenomena our empirical analysis is conducted using representative samples of population for 37 countries and a special form of bootstrapping that allows us to equalize individuals conditions and as a result analyze the choices of men and women put in identical economic environments and socio economic circumstances

explaining international variations in self employment evidence from a panel of oecd countries organisation for economic cooperation and development oecd data from 1972 to 1996 reveals substantial differences in the levels and trends of self employment rates across countries this article uses recently developed panel integration and cointegration techniques to explore the determinants of aggregate self employment rates we find that within the panel self employment rates are positively and significantly related to personal income tax rates and negatively and significantly related to the unemployment benefit replacement rate this accords a central role to government tax and transfer policies in contrast to nonrobust influences from macroeconomic variables which have been widely used in previous studies

competitive procurement with corruption we study competitive procurement administered by a corrupt agent who is willing to manipulate his evaluation of contract proposals in exchange for bribes with complete information and no corruption the efficient firm will win the contract for sure if the agent is corrupt and has large manipulation power however bribery makes it costly for the efficient firm to secure a sure win so in equilibrium the efficient firm loses the contract with positive probability the optimal scoring rule for the buyer deemphasizes quality relative to price and does not fully handicap and may even favor the efficient firm

rent dissipation when rent seekers are budget constrained in the original tullock 1975 1980 game an individual bidder s probability of winning with a bid b is proportional to br where the exponent reflects economies of scale in rent seeking different interpretations can be given to these probabilities first one may view r as a reflection of the political culture alternatively one may view r as a choice variable for a politician intuition suggests that a society with a high tolerance for the selling of political favors and politicians who are receptive to rent seeking would both induce greater rent seeking expenditures than other societies all else equal this paper shows that a lower value of r can actually lead to more rent dissipation than a higher value this paper also reinforces two points concerning rent seeking first the analysis confirms the robustness of under dissipation of rents even in the face of entry second it points out the importance of distinguishing between rent seeking expenditures and rent dissipation when bidders must borrow for example total expenditure may understate rent dissipation

estimating the demand for gasoline in developing countries senegal abstract this paper estimates the aggregate demand for gasoline in senegal from 1970 to 2008 the long term and short term elasticities of demand with respect to gasoline prices and income are of paramount interest in this study in senegal rising food prices unemployment and shortage of electric supply are always associated with the spiking cost of world oil prices to understand the external shocks of world oil price and demand for gasoline in senegal this study tested a log linear model against the linear model of the demand for oil function with lagged dependent variables as an explanatory variable here the linear specification of the demand for oil is rejected in this study in favor of the log linear the natural log transformation is typical when using high frequency data and significantly reduces skewness and kurtosis generally in this study i found that short run elasticity is smaller than long run elasticity and gasoline demand is inelastic with respect to both price and income for both the short and long runs in senegal this is why researcher like moosa posits that this assertion can be rationalised on the grounds that oil is such an important commodity that does not have close substitutes at least for its uses 1998 p 3

self employment wealth and job creation the roles of gender non pecuniary motivation and entrepreneurial ability this paper uses national child development study data for a large cohort of british individuals to explore the influence of education inheritance and other background characteristics on the propensity to become self employed and also on subsequent success as measured by job and wealth creation for the first time we study the effects of our regressor variables on our success measures via disaggregation of our sample by gender and in this way reveal striking differences between the determinants of male and female entrepreneurial performance

are business startups debt rationed using a large random sample of u k start ups and a rich data set the paper demonstrates that human capital is the true determinant of survival and that the correlation between financial capital and survival is spurious provision of finance is demand driven with banks supplying funds elastically and business requests governing take up firms self select for funds on the basis of the human capital endowments of the proprietors with better businesses more likely to borrow a reason why others have seemingly identified start up debt gaps may be the failure to test a sufficiently rich empirical model copyright 1996 by royal economic society

centralized vs decentralized contests we compare two contests decentralized in which there are several independent contests with non overlapping contestants and centralized in which all contestants fight for a unique prize which is the sum of all prizes in the small contests we study the relationship between payoffs and efforts between these two contests

technology of military conflict military spending and war abstract this paper studies how the technology of military conflict affects the allocation of resources in military spending guns and productive investment butter we first identify the fundamental property of conflict technology which the two commonly used contest success functions the difference and ratio forms share using this property named the constant elasticity of augmentation we construct a new class of contest success functions hence generalizing the two forms we provide axiomatic and probabilistic characterizations of the new contest success function then adopting the new contest success function we study how the elasticity of augmentation affects the trade off between guns and butter and countries international policy to settle or wage a war finally we estimate the elasticity of augmentation using actual battle data including seventeenth century european battles and world war ii battles and explore the implications of the estimated parameters of military technology on military spending and the preference of settlement