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We analyze winner-pay contests in which players select bids, the winner is determined probabilistically through a contest success function, and only the winner must pay her bid. We show that a pure-strategy Nash equilibrium exists and is unique under weak assumptions on the contest success function. We determine the Nash equilibrium for several examples. We also consider how equilibrium bids are influenced by private information about the value of winning the contest. Adapted from the source document.

In the European Union Emissions Trading System, the supply of carbon permits is determined in a decentralized manner by Member States. Alternatively, the supply could be determined by an EU central authority. We analyze whether decentralization leads to lower total abatement costs under various assumptions about the behavior of Member States and the privacy of information about their abatement costs. If Member States do not behave strategically, then decentralization is preferred, regardless of whether abatement costs are private information. If the Member States behave strategically, then decentralization may or may not be preferred, depending on the degree of uncertainty about abatement cost parameters, the variation in emission endowments, and the number of Member States.

We study a rent-seeking contest in which the players' valuations of the prize are private information. We determine a Bayesian equilibrium & give conditions under which the equilibrium exists. Although players are ex ante symmetric, increased possibilities for ex post lopsidedness lead to less aggressive bidding. (Lopsidedness increases as players' values become less positively correlated or as the variation in possible values increases.) We also compare the private-information contest to a related public-information contest in which the realizations of values are common knowledge. The contests are equally efficient & players are indifferent between the two, but risk-averse sellers of the prize are not. 1 Table, 3 Figures, 1 Appendix, 5 References. Adapted from the source document.

Assuming strict two-party competition, policy balancing models of the US senate imply that senators from the same state will often be from opposite parties and have great ideological divergence. We analyze the effect of independent candidates on these implications. Our theoretical model implies the two state senators will generally not be from opposite parties and will be closer in ideological space than if they were elected under strict two-party competition. Empirical analysis of senate composition from 1991 to 2002 supports the theory. [Reprinted by permission of Sage Publications Ltd., copyright 2008.]

Assuming strict two-party competition, policy balancing models of the US senate imply that senators from the same state will often be from opposite parties and have great ideological divergence. We analyze the effect of independent candidates on these implications. Our theoretical model implies the two state senators will generally not be from opposite parties and will be closer in ideological space than if they were elected under strict two-party competition. Empirical analysis of senate composition from 1991 to 2002 supports the theory.