Sabotage in Rent-Seeking Contests

Konrad, Kai A.

doi:10.1007/978-3-540-79182-9_28

Cited by 57 publications

(86 citation statements)

References 13 publications

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“…However, in the existing literature on betting (including Shin) a key objective has been to explain the favorite-longshot bias in race-track betting. 5 But we raise concern also about the unfairness of the contest not only for the sake of unsuspecting bettors, but for the viewing public and the media that rely on the public's interest in sports. How the threat of bribery and manipulation influences betting odds and the eventual occurrence of match-fixing is the main subject of our interest.…”

Section: Introductionmentioning

confidence: 99%

“…8 With the threat of match-fixing looming, in selecting odds the bookies take into account both the benefit and the danger of undercutting each other. When the influential punter 5 In a parimutuel market setting Winter and Kukuk (2008) allow a participant jockey to underperform and bet on a likely favorite. But they do not show when underperforming will be optimal and what betting strategy to follow.…”

Section: Introductionmentioning

confidence: 99%

“…For a contrast between how odds are set (or determined) in these two betting markets (but without the issues of match-fixing), see Ottaviani and Sorensen (2005;. 7 In contests involving rival firms or lobbies, sabotage is a well-studied theme; see, for instance, Konrad (2000). Our sports contest model is much simpler than the 'effort contest' games (such as the one analyzed by Konrad) in that we assume exogenous winning probabilities of the contestants due to their inherent skills (or characteristics), and sabotage is a deliberate under-performance relative to one's own skills.…”

Section: Introductionmentioning

confidence: 99%

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Match-fixing under competitive odds

Bag¹,

Saha²

2011

Games and Economic Behavior

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Two bookmakers compete in Bertrand fashion while setting odds on the outcomes of a sporting contest where an influential punter (or betting syndicate) may bribe some player(s) to fix the contest. Zero profit and bribe prevention may not always hold together. When the influential punter is quite powerful, the bookies may coordinate on prices and earn positive profits for fear of letting the 'lemons' (i.e., the influential punter) in. On the other hand, sometimes the bookies make zero profits but also admit match-fixing.

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Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Match-fixing under competitive odds

Bag¹,

Saha²

2011

Games and Economic Behavior

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“…First, the paper is naturally related to the large literature on individual rent-seeking contests initiated by Tullock (1980) and further developed by e.g. Dixit (1987), Leininger (1993, Baik (1994), Konrad (2000), Lee (2000), Baye & Hoppe (2003) or Morgan (2003). Second, the paper is closely related to a relatively small, but growing literature making contest models the core of a theory of the …rm.…”

Section: Introductionmentioning

confidence: 99%

Haggling for Rents, Relational Contracts, and the Theory of the Firm

Gürtler

2010

Schmalenbach Bus Rev

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In this paper, a formal rent-seeking theory of the …rm is developed. The main idea is that integration (compared to non-integration) facilitates rentseeking for the integrating party, but makes it harder for the integrated one. In a one-period model, this implies that the rent-seeking contest becomes more uneven and the parties rent-seek less. Here, integration is optimal. In the in…nitely-repeated version of the model, it is also possible for the parties to enter a relational contract, under which each promises not to engage in rent-seeking. Such a contract must be self-enforcing, for it cannot be enforced by court. It is shown that integration makes the relational contract less easily sustainable, as, due to its cost advantage, the integrating party gains more from deviating than any party under non-integration. Hence, integration is preferred, if relational contracts are not sustainable, while, otherwise, nonintegration may well be preferred. Moreover, it is shown that the model's predictions are in line with many empirical facts on the choice of ownership structures.

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“…Finally, Papers that deal with this subject are Lazear (1989), Konrad (2000), Chen (2003) and Kräkel (2005). Contrary to the doping literature, sabotaging players never get defaulted but have to bear costs of exerting sabotage.…”

Section: Introductionmentioning

confidence: 99%

Doping and cheating in contest-like situations

Kräkel

2007

European Journal of Political Economy

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit company supported by Deutsche Post World Net. The center is associated with the University of Bonn and offers a stimulating research environment through its research networks, research support, and visitors and doctoral programs. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. Terms of use: Documents in Doping and Cheating in Contest-Like Situations Matthias Kräkel D I S C U S S I O N P A P E R S E R I E SIZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. ABSTRACT Doping and Cheating in Contest-Like Situations *Individuals who compete in a contest-like situation (for example, in sports, in promotion tournaments, or in an appointment contest) may have an incentive to illegally utilize resources in order to improve their relative positions. We analyze such doping or cheating within a tournament game between two heterogeneous players. Three major effects are identified which determine a player's doping decision -a cost effect, a likelihood effect and a windfall-profit effect. Moreover, we discuss whether the favorite or the underdog is more likely to be doped, the impact of doping on overall performance, the influence of increased heterogeneity on doping, the welfare implications of doping, and possible prevention of doping.JEL Classification: J3, K42, M5

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Sabotage in Rent-Seeking Contests

Cited by 57 publications

References 13 publications

Match-fixing under competitive odds

Match-fixing under competitive odds

Haggling for Rents, Relational Contracts, and the Theory of the Firm

Doping and cheating in contest-like situations

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