Rent-seeking

Quick meaning: Rent-seeking is a noun meaning The effort to increase one's share of wealth without doing something productive or adding value.

Meaning

The effort to increase one's share of wealth without doing something productive or adding value.

More Meanings

1. (economics) The attempt to profit by manipulating the economic or political environment, for example, by seeking governmental action that restricts entry into a market.

Example Sentences

Legislation can result in rents (and profits) to special-interest groups. However, rent seeking by seeking favorable legislation can be costly (e.g., in contributions to campaigns).

It is almost certain that ‘rent-seeking’ would be a significant factor in a capitalist economy where the government encourages cartelization or confers ‘a leading sector’ role on any sector.

Let us assume, then, that a wealthy eccentric has put up $100 as a prize for the special lottery between A and B. Note that the amount spent on lottery tickets is retained by the lottery, not added onto the prize. This makes the game equivalent to rent seeking, where resources are also wasted.

Rent seeking, therefore, is rational for the individual as it increases individual accumulation (individual income and firm profits increase). From a societal perspective, rent seeking is irrational as resources are wasted by being diverted away from social accumulation for the sake of individual accumulation.

Related Words

Related dictionary entries include job hunting, jobseeking, jobbing, profitmongering, protection, risk-on.

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