Arbeitspapier

Firm Size, Economic Situation and Influence Activities

This paper discusses the optimal firm size in the presence of influence activities, and the level of individual rent-seeking dependent on the economic situation of the firm. Since size has a discouraging effect on the level of individual rent-seeking but also a quantity effect as the number of rent-seekers increases, the interplay of both effects determines whether the employer chooses an inefficiently small or large firm size. In the given setting, a bad economic situation leads to both a higher probability of a substantial loss and a reduction of productivity. The productivity effect and the two other effects together determine the optimal level of individual rent-seeking.

Sprache
Englisch

Erschienen in
Series: Bonn Econ Discussion Papers ; No. 16/2006

Klassifikation
Wirtschaft
Thema
economic situation
firm size
influence activities
politicking
rent-seeking

Ereignis
Geistige Schöpfung
(wer)
Kräkel, Matthias
Ereignis
Veröffentlichung
(wer)
University of Bonn, Bonn Graduate School of Economics (BGSE)
(wo)
Bonn
(wann)
2006

Handle
Letzte Aktualisierung
10.03.2025, 11:43 MEZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • Kräkel, Matthias
  • University of Bonn, Bonn Graduate School of Economics (BGSE)

Entstanden

  • 2006

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