Rent-Seeking

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Rent-Seeking

The practice of an individual, company, or government attempting to make a profit without making a product, producing wealth, or otherwise contributing to society. For example, a company may seek subsidies from the government, which would count as income for that company. Likewise, a government may seek rent by seizing control of natural resources and charging citizens for use. Some rent seeking is legal, while others, such as some forms of blackmail, are not. Rent-seeking behavior is most common when the rent seeker is also a monopoly or has sufficient economic or political power to act as one. The concept was originated by Adam Smith.
References in periodicals archive ?
Tullock responded that judges and lawyers may engage in rent-seeking behavior to maintain inefficient rules that line their own pockets.
At the same time, rent-seeking behavior has been apparent in some communities where they have organized themselves, not with the intention of collectively resolving local problems, but rather appropriating oil rent for individual enrichment.
Profit maximizing developers acting within the confines of bounded rationality may therefore negotiate inequitable terms and engage in rent-seeking behavior, as would be predicted by transaction cost economics (Nijkamp et al.
In short, rent-seeking behavior is chronic in modern Greek society, resulting in the emergence of a generally inefficient institutional economic framework that is financed through a dramatically expanding public deficit and public debt and supported by a strong continental currency, the euro.
The link between guanxi and rent-seeking behavior is obvious.
This may be the result or rent-seeking behavior by school officials, or a way for the school to reduce the price local price while still increasing the bundles of services offered.
In order to counter the conflict- producing patterns caused by these different levels of rent-seeking behavior, it is necessary to understand the influence of the key features of oil--its strategic value, capital intensity, depletability, and price volatility--all of which the editors suggest can be turned into potential benefits for conflict mitigation.
In fact, it has been claimed both that democratic regimes may reduce rent-seeking behavior in societies and that rent-seeking behavior may contribute to the downfall of democratic regimes.
Here we argue that the political economy model for SPS standards as a barrier to trade, especially the model of rent-seeking behavior (developed by Tullock (1967) and others), is likely a key factor in explaining the restrictions on avocado trade in the United States.
It also can lead to rent-seeking behavior on the part of local elites and a crowding out of domestic financial service providers.
In all of these cases, "protecting the public" is always the justification for this rent-seeking behavior.
Indonesia was not quite Nigeria -- at least the Indonesian kleptocracy tended to confine its rent-seeking behavior to the domestic market and kept most of its funds at home.