Rents, dissipation and lost treasures: Comment

Abstract

In an interesting recent paper, Dari-Mattiacci and Parisi (2005) extended Tullock's (1980) rent-seeking game with an entry decision. The mixed strategies identi…ed by Dari-Mattiacci and Parisi for the case of increasing returns in the contest success function (r > 2) do not constitute an equilibrium of the game they study. However, these strategies are an equilibrium if the strategy space of the game is restricted by a minimum expenditure requirement, and this minimum expenditure requirement is an element of a speci…c interval.