Rent Extraction And Rent Creation In The Economic

THE economic theory of economy has advanced considerably since
Stiglers originative piece explained governings ability to create rents by
cartelizing privy producers. Because political put to death can redistri stille
wealth generally, it is now seen that private interest groups otherwise than
producers also have an inducing to organize, both to obtain the gains and
to quash the losses from a whole menu of government enactments.2 The
chassis of winners and losers depends on many factors, and it
changes as the underlying demands for and costs of ordinance shift. New
technology, for example, may render existing government regulations
undesirable to their previous beneficiaries or make current regulations useful
to groups previously not benefited. Finally, government itself has
come to be treated, not as a unit, but as a complicated network of individuals,
each with an incentive to maximize his own interest.
The original economic theory of regulation thus has evolved into a more
complex description of the various ship canal government regulatory power
can be turned to private ends. Two limitations of the current economic
* John M. Olin Visiting Fellow in Law and scotchs, University of Chicago Law
School; Associate Professor, Emory University School of Law.



many another(prenominal) persons commented
implementallyo n earlier drafts of this paper, includingp articipantsi n presentationsa t Emory
University, Clemson University, the Federal carry on Commission, Holy Cross College, and
the annual meetings of the Western Economic knowledge (July 1985) and the Public Choice
Society (March 1985). My colleague David Haddock provided especially helpful comments.
Henry Butler, Frank Easterbrook, Ernest Gellhorn, Mark Moran, Timothy Muris, Steven
Salop, David Schap, and an anonymous reviewer also contributed much useful criticism. 1 George J. Stigler, The Theory of Economic Regulation, 2 Bell J. Econ. 3 (1971).
2 Sam Peltzman, Toward a More General Theory of Regulation, 19 J. Law & Econ....If you involve to get a full essay, order it on our website: Ordercustompaper.com



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