Rent, risk, and replication -: Preference adaptation in winner-take-all markets

• 成果类型: Article
• 署名作者: Wärneryd, K
• 署名单位: Stockholm School of Economics
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/S0899-8256(02)00503-1
• 发表日期: 2002
• 页码: 344-364
• 关键词: Preference evolution; risk attitudes; contests; winner-take-all markets

摘要

We study the evolution of an economy where agents who are heterogeneous with respect to risk attitudes can either earn a certain income or enter a risky rent-seeking contest. We assume that agents behave rationally given their preferences, but that the population distribution of preferences evolves over time in response to material payoffs. We show that, in particular, initial distributions with full support converge to stationary states where all types are still present. Although rents are perfectly dissipated in material terms at a steady state, efficiency is greater than if everybody had been risk neutral, since risk lovers specialize in rent seeking. (C) 2002 Elsevier Science (USA). All rights reserved.