Posts Tagged ‘rent-seeking

04
Jan
09

Tullock, Blagojevich, and rent-seeking public officials

Eminent economist, Gordon Tullock, takes on the topic of Gov. Blagojevich and the rent-seeking behavior of elected officials. Tullock has a deep understanding of the systematic actions politicians harbor and how they ultimately effect us in a negative fashion.

The income derived from possessing a special privilege is called “rent” (which, by the way, has nothing to do with the monthly payments that tenants make to landlords). Rents themselves are just a transfer of value from some people to others.

Such lobbying can reap advantages worth millions. So it’s understandable that companies spend considerable effort courting politicians who can bestow such privileges. That’s wasteful. Time, energy, and other materials that could be used to expand the output or improve the quality of goods and services are instead used to lobby government for narrow benefits that may harm society at large. And the larger the potential gain from being granted such a privilege – that is, the larger the rents – the more intense will be rent-seekers’ incentives to chase after them. That puts tremendous pressure on – and gives tremendous leverage to – politicians.

Read Donald Boudreaux’s Op-Ed here.

Donald J. Boudreaux, a professor of economics at George Mason University, is the author of “Globalization.”

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