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Social security trust fund flows and the welfare costs of rent seeking

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  • Franklin Mixon

Abstract

The current study provides estimates from a Parks regression (using panel data) that suggest that the welfare costs due to rent seeking efforts by interest groups to obtain Social Security trust fund flows ranged from approximately $132 million (per twoyear federal election cycle from 1985-1994) to a theoretical expectation of $66 billion, all in real terms. These welfare costs are in addition to any other social costs that may be present, including the reduced levels of national saving that Social Security may induce.

Suggested Citation

  • Franklin Mixon, 2002. "Social security trust fund flows and the welfare costs of rent seeking," Applied Economics, Taylor & Francis Journals, vol. 34(8), pages 975-979.
    • Handle: RePEc:taf:applec:v:34:y:2002:i:8:p:975-979
    DOI: 10.1080/00036840110062009
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    References listed on IDEAS

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    1. Franklin G. Mixon & James B. Wilkinson, 1999. "Maintaining the status quo: federal government budget deficits and defensive rent-seeking," Journal of Economic Studies, Emerald Group Publishing, vol. 26(1), pages 5-14, January.
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    3. Mixon, Franklin G, Jr & Laband, David N & Ekelund, Robert B, Jr, 1994. "Rent Seeking and Hidden In-Kind Resource Distortion: Some Empirical Evidence," Public Choice, Springer, vol. 78(2), pages 1717-1785, February.
    4. Feldstein, Martin S, 1982. "Social Security and Private Saving: Reply," Journal of Political Economy, University of Chicago Press, vol. 90(3), pages 630-642, June.
    5. Feldstein, Martin S, 1974. "Social Security, Induced Retirement, and Aggregate Capital Accumulation," Journal of Political Economy, University of Chicago Press, vol. 82(5), pages 905-926, Sept./Oct.
    6. Leimer, Dean R & Lesnoy, Selig D, 1982. "Social Security and Private Saving: New Time-Series Evidence," Journal of Political Economy, University of Chicago Press, vol. 90(3), pages 606-629, June.
    7. Martin Feldstein, 1982. "The Welfare Cost of Social Security's Impact on Private Saving," NBER Working Papers 0969, National Bureau of Economic Research, Inc.
    8. Lott, John R, Jr, 2000. "A Simple Explanation for Why Campaign Expenditures Are Increasing: The Government Is Getting Bigger," Journal of Law and Economics, University of Chicago Press, vol. 43(2), pages 359-393, October.
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