SSE/EFI Working Paper Series in Economics and Finance,
Stockholm School of Economics

Abstract: We study the long-run behavior of an economy where agents who are heterogeneous with respect to risk attitudes can either earn a certain income or enter a risky rent seeking contest. In contrast with standard evolutionary game theory, we distinguish between utility and material payoffs, and allow the population distribution of preferences to evolve over time in response to material payoffs. We show that, in particular, initial distributions with full support converge to stationary states where all types may still be present, risk lovers specialize in rent seeking, and the available rents are perfectly dissipated.

Keywords: Risk attitudes; rent seeking; evolution

JEL-codes: C72; D72; D80

27 pages, October 1995

Download statistics

Published as

Karl Wärneryd, (2002), 'Rent, Risk and Replication. Preference Adaptation in Winner-take-all Markets', Games and Economic Behavior, vol 41, pages 344-364

• Stockholm School of Economics
• Home page for this series

Questions (including download problems) about the papers in this series should be directed to Helena Lundin ()
Report other problems with accessing this service to Sune Karlsson ().

RePEc:hhs:hastef:0077This page generated on 2024-09-13 22:15:03.