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I've seen the term "rent seeking" used a few times here on HN, and I have no idea what it means. For those curious: Rent-seeking happens when a person or busin

by all2 7y ago

I've seen the term "rent seeking" used a few times here on HN, and I have no idea what it means. For those curious: Rent-seeking happens when a person or business uses their position or resources to get some additional benefit from the government. The most common occurrence is when a company or industry lobbies the government to receive special subsidies, grants, and tariff protection. The term "rent" in economics means receiving a payment that is over the costs involved in the production of the item or keeping the item in service. These actions do not produce any benefit for the community-at-large but only redistribute taxpayer's resources.[0] [0] https://www.investopedia.com/terms/r/rentseeking.asp https://www.investopedia.com/terms/r/rentseeking.asp

refurb 7y ago
On HN “rent seeking” has a broader meaning of “making money in a way I don’t like”.
wavefunction 7y ago
That's a very government centric definition but I prefer: >Rent-seeking is an attempt to obtain economic rent (i.e., the portion of income paid to a factor of production in excess of what is needed to keep it employed in its current use) by manipulating the social or political environment in which economic activities occur, rather than by creating new wealth. The important bit in rent-seeking is "rather than creating new wealth."
coolgeek 7y ago
As wavefunction notes, that is at best a very narrow definition. Here is Wikipedia's: "Rent-seeking is a concept in public choice theory as well as in economics, that involves seeking to increase one's share of existing wealth without creating new wealth. Rent-seeking results in reduced economic efficiency through misallocation of resources, reduced wealth-creation, lost government revenue, heightened income inequality, and potential national decline." https://en.wikipedia.org/wiki/Rent-seeking https://en.wikipedia.org/wiki/Rent-seeking

by all2 7y ago

refurb 7y ago

On HN “rent seeking” has a broader meaning of “making money in a way I don’t like”.

wavefunction 7y ago

That's a very government centric definition but I prefer: >Rent-seeking is an attempt to obtain economic rent (i.e., the portion of income paid to a factor of production in excess of what is needed to keep it employed in its current use) by manipulating the social or political environment in which economic activities occur, rather than by creating new wealth. The important bit in rent-seeking is "rather than creating new wealth."

coolgeek 7y ago

As wavefunction notes, that is at best a very narrow definition. Here is Wikipedia's: "Rent-seeking is a concept in public choice theory as well as in economics, that involves seeking to increase one's share of existing wealth without creating new wealth. Rent-seeking results in reduced economic efficiency through misallocation of resources, reduced wealth-creation, lost government revenue, heightened income inequality, and potential national decline." https://en.wikipedia.org/wiki/Rent-seeking https://en.wikipedia.org/wiki/Rent-seeking