The Rise and Decline of Regional Power: A Historical Case-Study of Privilege Seeking

This paper comprises one of Olson's findings about the rise and decline of nations and Tullock's idea of privilege-seeking. In the historical framework of Northern Europe the history of a town being closely linked with its saltern is investigated. It is shown that throughout the centuries rent- and privilege-seeking dominated. This was primarily done to avoid competition and, finally, to get excessive revenues. The sovereigns' production-costs of the privileges were low and Tuyllock's results of an efficient transfer mechanism are confirmed. Additionally, the findings of coalition-forming and mortgaging support the inevitable sclerotic process. Market activities find their political counterparts which is illustrated by the building and destroying of specific coalitions. A typical delay of of privilege- and coalition-seeking is observed depending on the economic and political success. Regulatory measures are explored then 'exploited', and allies are found, 'utilized' and dropped, finally leaving certified rents of no value. Copyright 1994 by Kluwer Academic Publishers