Rent-Seeking
The use of economic or political power to capture existing wealth rather than create new value — a concept rooted in the analysis of land rent.
Definition
Rent-seeking is the expenditure of resources to capture economic rent — to obtain a larger share of existing wealth — rather than to create new wealth. Examples include lobbying for subsidies or monopoly privileges, and, paradigmatically, capturing the unearned increment of land.
Origins
The behaviour was analysed by Gordon Tullock (1967) and named "rent-seeking" by Anne Krueger (1974). The terminology draws directly on the classical analysis of land rent: rent is the original case of income obtained from control of a scarce, unproduced asset rather than from production.
Connection to Georgism
Georgist analysis treats private capture of land rent as the foundational form of rent-seeking — value extracted from the community's activity without contribution. Modern work such as Mazzucato et al. (2023) extends the framework from land to finance and digital platforms, and Stiglitz places rent-seeking at the center of inequality.
See Also
Sources
- Anne Krueger (1974), "The Political Economy of the Rent-Seeking Society," American Economic Review.
- Mazzucato, Ryan-Collins & Gouzoulis (2023) — wiki summary