Analysis Rent-Seeking Behavior by Repeated Games

Document Type : Research Paper

Authors

1 Associate Professor of Faculty of Engineering, Alzahra University

2 MA student of Industrial Engineering, Alzahra University

3 . MA student of Industrial Engineering, Alzahra University

Abstract

Rent-seeking is an effort that is formed between a company and its employees to obtain more profit under their tendency to rent-seeking. In this paper, the interaction between a company and its employees is studied by an unlimited multi stage repeated games. According to the strategies of the  company and its employees(the players)- payment and punishment types for rent-seeker employee- subgame perfect equilibrium (SPE) and their payoffs are obtained based on the history of game. Finally it will be proved that based on which condition( the punishment and payment types), the employees do not choose the rent-seeking strategies and behave honestly.
JEL Classification: D72, C73, C73.

Keywords

References

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History

  • Receive Date: 21 February 2016
  • Revise Date: 13 November 2016
  • Accept Date: 27 February 2017

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