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Public Choice

, Volume 153, Issue 1–2, pp 149–161 | Cite as

The evolution of sharing rules in rent seeking contests: Incentives crowd out cooperation

  • Heinrich W. Ursprung
Article

Abstract

Modern societies are characterized by competing organizations that rely predominantly on incentive schemes to align the behavior of their members with the organizations’ objectives. This study contributes to explaining why in so many cases incentive schemes have gradually crowded out cooperation as an organization device. Our explanation does not draw on free-riding, the obvious Achilles’ heel of cooperation, but relies completely on fundamental group contest mechanisms. By investigating a canonical rent seeking model and adopting an evolutionary perspective, the analysis identifies shortcomings in previous results, sets the record straight, and explains why the process of incentivizing organizations is protracted.

Keywords

Group contests Rent-seeking Sharing rules Cooperation Incentives Evolution 

JEL Classification

D72 D74 M52 

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Copyright information

© Springer Science+Business Media, LLC 2011

Authors and Affiliations

  1. 1.Department of EconomicsUniversity of KonstanzKonstanzGermany

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