Effort and Performance in Public-Policy Contests



(10)

dPr*L

= ∂ Pr L ∂ x * L

= ∂ x * L d I

Pr Lx*H

_l___

dI

x*H

I

Note that -dPL- = -
d x H

PrH

*,
xH

2Prl _

* * ʌ *

xx

HL

-2PrH

x*Hx

Pri      1

— and ----= — . Thus

L         ∂ xl     nl(I )

may rewrite (10) as:


(11) dPr*L
dI

1

[      ∂2 Prh

H

~d------

Bn n
LH

nn

Ч L H X, Xh

(ηHL )


pPrH

Ч ∂x2H


η Ln2 H


2 PrL     2

2 L ηHn2L
x l


we

Λ

JJJ
J


This gives


Proposition 5:


d Pr* L
dI


> 0 if -∂LPTl.

<       ∂ xLxH


(ηHL )>
<


p⅛

Ч ∂x2H


nH
η L —


2 PrL


l    ∂x2L


nL
ηH


nh


By this proposition we get:


Corollary 5.1:


dPr*L

(a) Under a type-(ι) reform with i=H, ------<

dI


if


2 Pr

------L- ≤ 0 ;

xLxH


d Pr*L

(b) Under a type-(ιv) reform with i=L, ------

dI


> 0 if


2 PrL

------L- ≥ 0 ;

xLxH


© Under a type-(iv) reform,


dPr*L > 0 if 2Prh
d I <      ∂x 2 H


> ηH nL

2

< ηLnH


2PrL
and-----L


-0 ;

xL xH


(d) Under a type-(v) reform,


dP 0 if
dI <


2PrH
x 2 h


(d2PrLH


dx 2

Ч xLL J


2
nL

> ηL nH2


2PrL
and--0.

xHxL


19




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