IDEAS home Printed from https://ideas.repec.org/a/sae/pubfin/v27y1999i5p561-565.html
   My bibliography  Save this article

The Reformer’s Dilemma

Author

Listed:
  • William F. Shughart II

    (University of Mississippi)

Abstract

By redirecting scarce resources away from socially productive employment, the pursuit of wealth transfers by special interest groups converts those transfers into social costs. In the limit, the available rents are fully dissipated and the welfare loss associated with rent seeking equals the sum of the value of the rent rectangle and the deadweight loss triangle. This article shows that by eliciting expenditures to defend existing rents, attempts to reform the rent-seeking society cannot lower the social cost bill; they can only add to it. Hence, the only way to avoid the reformer's dilemma is to not grant monopoly rights in the first place.

Suggested Citation

  • William F. Shughart II, 1999. "The Reformer’s Dilemma," Public Finance Review, , vol. 27(5), pages 561-565, September.
    • Handle: RePEc:sae:pubfin:v:27:y:1999:i:5:p:561-565
    DOI: 10.1177/109114219902700506
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/109114219902700506
    Download Restriction: no
    File URL: https://libkey.io/10.1177/109114219902700506?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Mueller,Dennis C. (ed.), 1997. "Perspectives on Public Choice," Cambridge Books, Cambridge University Press, number 9780521553773, November.
    2. Gordon Tullock, 1975. "The Transitional Gains Trap," Bell Journal of Economics, The RAND Corporation, vol. 6(2), pages 671-678, Autumn.
    3. Posner, Richard A, 1975. "The Social Costs of Monopoly and Regulation," Journal of Political Economy, University of Chicago Press, vol. 83(4), pages 807-827, August.
    4. Landes, William M & Posner, Richard A, 1975. "The Independent Judiciary in an Interest-Group Perspective," Journal of Law and Economics, University of Chicago Press, vol. 18(3), pages 875-901, December.
    5. Douglas, George W & Miller, James C, III, 1974. "Quality Competition, Industry Equilibrium, and Efficiency in the Price-Constrained Airline Market," American Economic Review, American Economic Association, vol. 64(4), pages 657-669, September.
    6. McCormick, Robert E & Shughart, William F, II & Tollison, Robert D, 1984. "The Disinterest in Deregulation," American Economic Review, American Economic Association, vol. 74(5), pages 1075-1079, December.
    7. William Corcoran, 1984. "Long-run equilibrium and total expenditures in rent-seeking," Public Choice, Springer, vol. 43(1), pages 89-94, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Germain Belzile & Rosolino A. Candela & Vincent Geloso, 2022. "Regulatory capture and the dynamics of interventionism: the case of power utilities in Quebec and Ontario to 1944," Public Choice, Springer, vol. 193(1), pages 35-61, October.
    2. repec:elg:eechap:15325_11 is not listed on IDEAS

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:elg:eechap:15325_11 is not listed on IDEAS
    2. Robert Michaels, 1988. "The design of rent-seeking competitions," Public Choice, Springer, vol. 56(1), pages 17-29, January.
    3. Cairns, Robert D., 1992. "La recherche de rentes en situation d’incertitude avec ou sans opposition," L'Actualité Economique, Société Canadienne de Science Economique, vol. 68(3), pages 477-498, septembre.
    4. James Lake & Maia Linask, 2015. "Costly distribution and the non-equivalence of tariffs and quotas," Public Choice, Springer, vol. 165(3), pages 211-238, December.
    5. Çetin, Tamer & Yasin Eryigit, Kadir, 2013. "The economic effects of government regulation: Evidence from the New York taxicab market," Transport Policy, Elsevier, vol. 25(C), pages 169-177.
    6. Mwangi Kimenyi & William Shughart, 2010. "The political economy of constitutional choice: a study of the 2005 Kenyan constitutional referendum," Constitutional Political Economy, Springer, vol. 21(1), pages 1-27, March.
    7. John Boatright, 2009. "Rent Seeking in a Market with Morality: Solving a Puzzle About Corporate Social Responsibility," Journal of Business Ethics, Springer, vol. 88(4), pages 541-552, October.
    8. John P. Formby & Paul D. Thistle & James P. Keeler, 1990. "Costs under Regulation and Deregulation: The Case of US Passenger Airlines," The Economic Record, The Economic Society of Australia, vol. 66(4), pages 308-321, December.
    9. Aleksandar Vasilev, 2013. "On the cost of rent-seeking by government bureaucrats in a Real-Business-Cycle framework," Working Papers 2013_20, Business School - Economics, University of Glasgow.
    10. Frank Buckley & Eric Rasmusen, 2000. "The Uneasy Case for the Flat Tax," Constitutional Political Economy, Springer, vol. 11(4), pages 295-318, December.
    11. Gorecki, Paul K., 2009. "The Recession, Budgets, Competition, and Regulation: Should the State Supply Bespoke Protection?," Papers BP2010/2, Economic and Social Research Institute (ESRI).
    12. Bonardi, Jean-Philippe, 2008. "The internal limits to firms' nonmarket activities," MPRA Paper 14500, University Library of Munich, Germany.
    13. Arye Hillman & Dov Samet, 1987. "Dissipation of contestable rents by small numbers of contenders," Public Choice, Springer, vol. 54(1), pages 63-82, January.
    14. Pasour, E.C., Jr., 1980. "A Critique Of Federal Agricultural Programs," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 12(1), pages 1-9, July.
    15. Lars P. Feld & Gebhard Kirchgässner, 2003. "Die Rolle des Staates in privaten Governance Strukturen," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 139(III), pages 253-285, September.
    16. Germain Belzile & Rosolino A. Candela & Vincent Geloso, 2022. "Regulatory capture and the dynamics of interventionism: the case of power utilities in Quebec and Ontario to 1944," Public Choice, Springer, vol. 193(1), pages 35-61, October.
    17. Rowley, Charles K., 2000. "Political culture and economic performance in sub-Saharan Africa," European Journal of Political Economy, Elsevier, vol. 16(1), pages 133-158, March.
    18. Alexander Matros, 2007. "Contests with a Stochastic Number of Players," Working Paper 323, Department of Economics, University of Pittsburgh, revised Sep 2008.
    19. Axel Dreher & Katharina Michaelowa, 2008. "The political economy of international organizations," The Review of International Organizations, Springer, vol. 3(4), pages 331-334, December.
    20. Glenn Furton & Adam Martin, 2019. "Beyond market failure and government failure," Public Choice, Springer, vol. 178(1), pages 197-216, January.
    21. Daniel Sutter, 2003. "Durable Constitutional Rules and Rent Seeking," Public Finance Review, , vol. 31(4), pages 413-428, July.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:pubfin:v:27:y:1999:i:5:p:561-565. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.