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Companion to the Political Economy of Rent Seeking

Edited by Roger D. Congleton, BB&T Professor of Economics, West Virginia University, US and Arye L. Hillman, William Gittes Chair, Professor of Economics, Bar-Ilan University, Israel
The quest for benefit from existing wealth or by seeking privileged benefit through influence over policy is known as rent seeking. Much rent seeking activity involves government and political decisions and is therefore in the domain of political economy, although it can also take place in personal relations and within firms and bureaucracies. Rent seeking, which involves the unproductive use of resources, is however primarily associated with policies that create rents as well as rent extraction or political benefit for the creators of rents. The contributions in this outstanding volume provide an accompaniment or “companion” to the literature on rent seeking and the related political economy of rent creation and extraction. The chapters, written by leading scholars in the field, demonstrate the centrality of rent-related incentives to the study of economics, politics, culture, public administration and history.
Extent: 552 pp
Hardback Price: $240.00 Web: $216.00
Publication Date: 2015
ISBN: 978 1 78254 493 7
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  • Economics and Finance
  • Political Economy
  • Public Choice Theory
  • Politics and Public Policy
  • Political Economy
  • Public Choice
The quest for benefit from existing wealth or by seeking privileged benefit through influence over policy is known as rent seeking. Much rent seeking activity involves government and political decisions and is therefore in the domain of political economy, although rent seeking can also take place in personal relations and within firms and bureaucracies. The contributions in this outstanding volume provide an accompaniment or ‘companion’ to the literature on rent seeking and the related political economy of rent creation and extraction. The chapters, written by leading scholars in the field, demonstrate the centrality of rent-related incentives to the study of economics, politics, culture, public administration and history.

The expert and original contributions summarize and extend the literature in both theoretical and applied areas of research. The book begins with a clear and comprehensive description of the theory of rent seeking and of contest design for political and bureaucratic rent extraction. This is followed by a series of case studies showing the relevance of rent seeking for regulatory policies, international-trade policies, public finance, natural-resource discoveries, development aid, behavior in international bureaucracies, litigation and judicial systems. The applied chapters also include overviews of rent seeking and rent extraction in Europe, Russia, Asia, Africa and the US.

This volume will appeal to a broad readership, including economists, political scientists and development practitioners, wishing to gain an understanding of the concept of rent seeking. The chapters in this book also provide an excellent introduction to the extensive literature.

‘This twenty-seven chapter book provides an excellent and accessible overview of the literature on rent seeking since its inception. What makes the book a fascinating reading is its application to different areas, such as regulation and economic aid, and presentation of an array of highly readable cases studies, including on China, Greece, India and Russia. It is a must for both students of public finance and policy makers.’
– Sanjeev Gupta, International Monetary Fund

‘Indeed, this book is an indispensable companion to everyone working on rent seeking or the theory or politics of contests. It combines excellent surveys and innovative work of the most eminent researchers in this field.’
– Kai Konrad, Director, Max Planck Institute for Tax Law and Public Finance, Munich, Germany
Contributors: J. A. Amegashie, M. Brooks, R.D. Congleton, G. Dari-Mattiacci, R.T. Deacon, G.S. Epstein, S. Flamand, R.J. Hagan, A.L. Hillman, R.G. Holcombe, C. Kang, M.S. Kimenyi, E. Langlais, M.I. Levin, N. Van Long, B. Lovat, B. Luppi, S. Marjit, J.M. Mbaku, Y. Mealem, T. Moutos, D. C. Mueller, V. Mukherjee, S. Nitzan, M. Paldam, F. Parisi, L. Pechlivanos, L. Qijun, A. Rode, G.A.Satarov, R.M. Sheremeta, W.F. Shughart II, D.W. Thomas, G. Tridimas, O. Troumpounis, R. Vaubel, K. Wärneryd









Contents:

PART I: INTRODUCTION
1. The Nature of Rent Seeking
Roger D. Congleton

2. Rent Seeking as Political Economy
Arye L. Hillman

PART II: THEORY
3. The Theory of Contests: A Unified Model and Review of the Literature
Ngo Van Long

4. Contestable Policies
Gil S. Epstein and Shmuel Nitzan

5. Asymmetries in Rent Seeking
Giuseppe Dari-Mattiacci, Eric Langlais, Bruno Lovat, and Francesco Parisi

6. Prize-sharing Rules in Collective Rent Seeking
Sabine Flamand and Orestis Troumpounis

7. Rent Seeking and Organizational Structure
Karl Wärneryd

8. Contest Effort
Yosef Mealem and Shmuel Nitzan

9. Sabotage in Contests
J. Atsu Amegashie

10. Behavioral Dimensions of Contests
Roman M. Sheremeta

PART III: APPLICATIONS AND OUTCOMES
11. Regulatory Rent Seeking
William F. Shughart II and Diana W. Thomas

12. Rents and International Trade Policy
Arye L. Hillman

13. Rent Seeking Through Public Finance
Michael Brooks

14. Rent Seeking and the Resource Curse
Robert T. Deacon and Ashwin Rode

15. Rents and the Political Economy of Development Aid
Rune Jansen Hagen

16. Rent Seeking in International Organizations
Roland Vaubel

17. Litigation as Rent Seeking
Francesco Parisi and Barbara Luppi

PART IV: THE REALITY OF RENTS
18. Profit Seeking and Rent Seeking in the United States and Europe
Dennis C. Mueller

19. Rents in a Welfare State
Martin Paldam

20. Rent Seeking Through Control of the State in Russia
Mark I. Levin and Georgy A. Satarov

21. Rents and Development Failure in Africa
John Mukum Mbaku and Mwangi S. Kimenyi

22. Economic Development and Corruption in China in the Shadow of Rent Seeking
Kang Chen and Liu Qijung

23. Market Liberalization and Rent Seeking in India
Sugata Marjit and Vivekananda Mukherjee

24. The Democratization of Rent Seeking in Modern Greece
Thomas Moutos and Lambros Pechlivanos

25. Rent Seeking in the Democracy of Ancient Greece
George Tridimas

PART IV: CONSTITUTIONS AND INSTITUTIONS
26. Rent Seeking and Constitutional Political Economy
Randall G. Holcombe

27. Rent Seeking and Organizational Governance: Limiting the Losses from Intra-organizational Conflict
Roger D. Congleton

Index