The 2002 Winter Olympics scandal: rent-seeking and committees

Abstract

In the wake of a judging controversy at the Winter 2002 Olympic games, the governing council of the International Skating Union scrapped its judging system, replacing it with a new system which uses scores from only some of the judges, selected randomly. This means that the composition of the awarding committee is unknown. I examine rent-seeking expenditures when the composition of the committee is unknown relative to the case when it is known. When the composition of the committee is unknown, I find that rent-seeking expenditures directed towards each committee member may fall but aggregate rent-seeking expenditures will not fall. I find the counter-intuitive result that there may be no change in the rent-seeking effort directed at each committee member, even if it is known that some of the members will not be part of the final awarding committee. The results hinge on whether there is full rent dissipation or rent under-dissipation when the composition of the committee is known.