Rent-Seeking Behavior Quotes

Crony capitalism is much easier than competing in an open market. But it erodes our overall standard of living and stifles entrepreneurs by rewarding the politically favored rather than those who provide what consumers want.

Russia ... suffers the dubious distinction of being the most corrupt developed country in the world, and its resource-extracting, rent-seeking economic system has reached a dead end.

When a nation is over-reliant on one or two commodities like oil or precious minerals, corrupt government ministers and their dodgy associates hoard profits and taxes instead of properly allocating them to schools and hospitals.

Mobutu was mainstream Africa. Every independent African Government was a one-party state at the time. None allowed opposition. Every one of them had rent-seeking political leaders. The only thing that set Mobutu apart was how ostentatious his theft was.

Too many business have successfully lobbied for special favors and treatment by seeking mandates for their products, subsidies (in the form of cash payments from the government), and regulations and tariffs to keep more efficient competitors at bay. Crony capitalism is much easier than competing in an open market. But it erodes our overall standard of living and stifles entrepreneurs by rewarding the politically favored rather than those who provide what consumers want.

How do you whip up resentment against absentee landlords and pocketers of bribes when the highest ambition of the people is either to become the former or be in a position to receive the latter?

A lot of my book, 'The Price of Inequality,' is about why there has been an increase in rent-seeking.

Because the free market system is so weak politically, the forms of capitalism that are experienced in many countries are very far from the ideal. They are a corrupted version, in which powerful interests prevent competition from playing its natural, healthy role.

There are now businesses and entire industries that exist solely as a result of federal patronage. Profiting from government instead of earning profits in the economy, such businesses can continue to succeed even if they are squandering resources and making products that people wouldn't ordinarily buy.

Many businesses with unpopular products or inefficient production find it much easier to curry the favor of a few influential politicians or a government agency than to compete in the open market.

But it [crony capitalism] erodes our overall standard of living and stifles entrepreneurs by rewarding the politically favored rather than those who provide what consumers want.

What is not OK is for rent-seekers to get rich.

Building on the public's unwillingness to act on principle in support of market solutions to apparent problems, whether real or imagined, these interest groups secure arbitrary restrictions on voluntary exchanges and, in the process, secure rents for their members while reducing both the liberties and economic well being of other members of the economic nexus, both domestically and internationally.

I have read all that has been written by the gravest authorities on political economy on the subject of rent, wages, taxes, tithes.

If you have an area where high-income receivers concentrate, you have a higher fiscal capacity. That fiscal capacity is a valuable resource and will create rent-seeking. People will trying to get that resource one way or the other, including immigration. It is very much like the medieval peasants putting their sheep on the commons pasture. It is better than the open range, and if you let them have open access they will, in fact, put too many sheep on the pasture and waste the value that the pasture has.