Rents and Rent-Seeking
Rents are a perfectly good economic category and there is absolutely nothing in general against seeking them. If I were to invent and patent a cure for cancer and then became extremely wealthy by claiming rents on the patent, most people would regard me as a public benefactor. Nevertheless, “rent-seeking” is regarded as an unadulterated evil. The reason of course is the type of rent. The rents that attract rent-seeking waste resources in static models. In dynamic settings, their injury to society is even greater. The purpose of this essay is to clearly distinguish between what we may call “good rents” and “bad rent-seeking”.
KeywordsCost Curve Potential Entrant Cable Television Cable Network Pecuniary Externality
Unable to display preview. Download preview PDF.