Public Choice

, Volume 181, Issue 1–2, pp 49–69 | Cite as

Measuring rent-seeking

  • David N. LabandEmail author
  • John P. Sophocleus


Some 30 years ago Gordon Tullock, in his capacity as Editor of Public Choice, made a pointed effort to motivate researchers to measure and quantify resource investments in rent-seeking activities. Despite Tullock’s identification of this aspect of rent-seeking as a significant gap in the literature and call to arms, this remains an under-studied topic of importance. Why is this? In our opinion, the answer is that, for a variety of reasons, measuring rent-seeking turns out to be very difficult. In this paper we identify and discuss several of the difficulties, both theoretical and empirical, although we concede that our treatment surely is not exhaustive.


Rent-seeking Social cost Market distortion 



We greatly appreciate the helpful comments provided by two anonymous reviewers, Matt Mitchell and Bill Shughart. The usual disclaimer applies.


  1. Aidt, T., Dutta, J., & Vania, S. (2008). Governance regimes, corruption and growth: Theory and evidence. Journal of Comparative Economics, 36, 195–220.CrossRefGoogle Scholar
  2. Alcalde, J., & Dahm, M. (2010). Rent seeking and rent dissipation: A neutrality result. Journal of Public Economics, 94, 1–7.CrossRefGoogle Scholar
  3. Appelbaum, E., & Katz, E. (1986). Transfer seeking and avoidance: On the full social cost of rent seeking. Public Choice, 48, 175–181.CrossRefGoogle Scholar
  4. Armey, D. (1996). How taxes corrupt. Wall Street Journal, A20.Google Scholar
  5. Assiotis, A., & Sylwester, K. (2014). Do the effects of corruption upon growth differ between democracies and autocracies? Review of Development Economics, 18(3), 581–594.CrossRefGoogle Scholar
  6. Bertrand, M., Bombardini, M., & Trebbi, F. (2014). Is it whom you know or what you know: An empirical assessment of the lobbying process. American Economic Review, 104(12), 3885–3920.CrossRefGoogle Scholar
  7. Buchanan, J. M. (1980). Rent seeking and profit seeking. In J. M. Buchanan, R. D. Tollison, & G. Tullock (Eds.), Toward a theory of the rent-seeking society (pp. 3–15). College Station, TX: Texas A&M University Press.Google Scholar
  8. Buchanan, J. M., & Tullock, G. (1962). The calculus of consent. Ann Arbor: University of Michigan Press.CrossRefGoogle Scholar
  9. Campos, N. F., & Giovannoni, F. (2007). Lobbying, corruption and political influence. Public Choice, 131(1), 1–21.CrossRefGoogle Scholar
  10. Congleton, R. D., Hillman, A. L., & Konrad, A. D. (Eds.). (2008). 40 Years of research on rent seeking 1—Theory of rent seeking. Heidelberg: Springer.Google Scholar
  11. Del Rosal, I. (2011). The empirical measurement of rent seeking costs. Journal of Economic Surveys, 25(2), 298–325.CrossRefGoogle Scholar
  12. Editors. (2017). The real democratic party. Wall Street Journal, A16.Google Scholar
  13. Hall, J., Matti, J., & Ferreira Neto, A. B. (2019). Rent seeking in the classroom and textbooks: Where are we after 50 years? Public Choice.
  14. Hall, J., & Ross, J. M. (2010). New empirical estimates of rent seeking: An update of Sobel and Garrett. Journal of Public Finance and Public Choice, 27(2–3), 125–136.Google Scholar
  15. Harper, J. (2014). 4 Million Words: the U.S. Tax Code is seven times the length of ‘War and Peace’. Washington Times, April 15. Accessed May 18, 2017.
  16. Hauser, K. (1993). Try the flat tax. Wall Street Journal, A10.Google Scholar
  17. Higgins, R. S., Shughart, W. F., II, & Tollison, R. D. (1985). Free entry and efficient rent seeking. In C. K. Rowley, R. D. Tollison, & G. Tullock (Eds.), The political economy of rent-seeking (pp. 127–140). Dordrecht: Kluwer Academic Press.Google Scholar
  18. Hillman, A. L. (2013). Rent seeking. The Elgar companion to public choice (pp. 307–330). Cheltenham: Edward Elgar.CrossRefGoogle Scholar
  19. Hillman, A. L., & Katz, E. (1984). Risk-averse rent seekers and the social cost of monopoly power. Economic Journal, 94, 104–110.CrossRefGoogle Scholar
  20. Hillman, A. L., & Katz, E. (1987). Hierarchical structure and the social costs of bribes and transfers. Journal of Public Economics, 34, 129–142.CrossRefGoogle Scholar
  21. Hillman, A. L., & Samet, D. (1987). Dissipation of contestable rents by small numbers of contenders. Public Choice, 54, 63–82.CrossRefGoogle Scholar
  22. Hines Jr., J. (1995). Forbidden payment: Foreign bribery and American business after 1977. NBER Working Paper 5266.Google Scholar
  23. Jenkins Jr., H. W. (2017). Trump skips climate church. Wall Street Journal, A13.Google Scholar
  24. Kaufmann, D., & Wei, S.-J. (1999). Does grease money speed up the wheels of commerce? World Bank Policy Research Working Paper No. 2254.Google Scholar
  25. Krueger, A. O. (1974). The political economy of the rent seeking society. American Economic Review, 64(3), 291–303.Google Scholar
  26. Laband, D. N., & Sophocleus, J. P. (1988). The social cost of rent-seeking: First estimates. Public Choice, 58(3), 269–275.CrossRefGoogle Scholar
  27. Laband, D. N., & Sophocleus, J. P. (1992). An estimate of resource expenditures on transfer activity in the United States. Quarterly Journal of Economics, 107(3), 959–983.CrossRefGoogle Scholar
  28. Long, N. V. (2013). The theory of contests: A unified model and review of the literature. European Journal of Political Economy, 32, 161–181.CrossRefGoogle Scholar
  29. Mauro, P. (1995). Corruption and growth. Quarterly Journal of Economics, 110, 681–712.CrossRefGoogle Scholar
  30. McChesney, F. S. (1987). Rent extraction and rent creation in the economic theory of regulation. Journal of Legal Studies, 16(1), 101–118.CrossRefGoogle Scholar
  31. McCormick, R. E., Shugart, W. F., II, & Tollison, R. D. (1984). The disinterest in deregulation. American Economic Review, 74(5), 1075–1079.Google Scholar
  32. Mendéz, F., & Sepúlveda, F. (2006). Corruption, growth and political regimes: Cross country evidence. European Journal of Political Economy, 22, 82–98.CrossRefGoogle Scholar
  33. Méon, P.-G., & Sekkat, K. (2005). Does corruption grease or sand the wheels of growth? Public Choice, 122, 69–97.CrossRefGoogle Scholar
  34. Mitchell, M. D. (2019). Uncontestable favoritism. Public Choice.Google Scholar
  35. Mixon, F. G., Laband, D. N., & Ekelund, R. B., Jr. (1994). Rent seeking and hidden resource distortion: Some empirical evidence. Public Choice, 78(2), 171–185.CrossRefGoogle Scholar
  36. Olson, M. (1982). The rise and decline of nations. New Haven: Yale University Press.Google Scholar
  37. Sobel, R. S., & Garrett, T. A. (2002). On the measurement of rent seeking and its social opportunity cost. Public Choice, 112(1–2), 115–136.CrossRefGoogle Scholar
  38. Swaleheen, M. U., & Stansel, D. (2007). Economic freedom, corruption, and growth. Cato Journal, 27, 343–358.Google Scholar
  39. Tanzi, V. (1998). Corruption around the world: Causes, consequences, scope and cures. International Monetary Fund Staff Papers, 45, 559–594.CrossRefGoogle Scholar
  40. Tullock, G. (1967). The welfare costs of tariffs, monopolies, and theft. Western Economic Journal, 5(3), 224–232.Google Scholar
  41. Tullock, G. (1980a). Efficient rent seeking. In J. M. Buchanan, R. D. Tollison, & G. Tullock (Eds.), Toward a theory of the rent-seeking society (pp. 97–112). College Station, TX: Texas A&M University Press.Google Scholar
  42. Tullock, G. (1980b). Rent seeking as a negative-sum game. In J. M. Buchanan, R. D. Tollison, & G. Tullock (Eds.), Toward a theory of the rent-seeking society (pp. 16–36). College Station, TX: Texas A&M University Press.Google Scholar
  43. Tullock, G. (1989). The economics of special privilege and rent seeking. Dordrecht: Kluwer Academic Press.CrossRefGoogle Scholar
  44. Tullock, G. (1997). Where is the rectangle? Public Choice, 91, 149.CrossRefGoogle Scholar
  45. Wei, S.-J. (2000). How taxing is corruption on international investors? Review of Economics and Statistics, 82(1), 1–11.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Department of EconomicsAuburn UniversityAuburnUSA

Personalised recommendations