TY  - RPRT
        AU  - Kräkel, Matthias
        TI  - Firm Size, Economic Situation and Influence Activities
        PY  - 2006/Oct/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 2391
        UR  - https://www.iza.org/publications/dp2391
        AB  - 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 firm 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.
        KW  - economic situation
KW  - firm size
KW  - influence activities
KW  - politicking
KW  - rent-seeking
        ER  -