Rent Seeking for Pure Public Goods: Wealth and Group's Size Heterogeneity

Abstract

We study how between‐group wealth and size asymmetries affect aggregate rent‐seeking efforts when two groups compete for the allocation of a pure public good. Unlike with previous analyses on between‐group asymmetries, we measure the utility cost of rent‐seeking in terms of the loss in private consumption an individual faces when contributing to this activity. Our main result is that fewer between‐group asymmetries do not necessarily imply greater aggregate rent‐seeking efforts. The result is at odds with the commonly held notion that the more homogeneous the contestants in a static rent‐seeking model, the greater the aggregate rent‐seeking efforts.