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Rent Seeking and Inclusiveness

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Abstract

This paper develops a model of political support in which governments gain support by creating wealth and also by creating rent, which gives rise to rent seeking, a major cause of inequality and poor economic performance. Rent seeking links the economic and political systems. A low rent-seeking option maximizes support only when “inclusiveness,” as defined and measured here, is high. The effects of inclusiveness on economic variables are examined, along with how the quest for political support causes inclusiveness to change. Depending on comparative political advantage, this quest can become the road to serfdom or the road to an inclusive polity, a kind of political invisible hand. The approach here avoids problems associated with the minimal "winning coalition" of selectorate theory.

Suggested Citation

  • Richard L. Carson, 2009. "Rent Seeking and Inclusiveness," Carleton Economic Papers 09-05, Carleton University, Department of Economics, revised 19 Dec 2016.
    • Handle: RePEc:car:carecp:09-05
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    More about this item

    Keywords

    Rent seeking; inclusivenes; spolitical support; comparative political advantage;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H00 - Public Economics - - General - - - General
    • H19 - Public Economics - - Structure and Scope of Government - - - Other

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