Rent-seeking

A political annuity is an income that you received from the State or bureaucratic institutions without providing anything in return. This can be achieved for example by direct government transfers or state discrimination of competitors. Under a pension generally understood in the economics of the amount received by the owner of a resource over its opportunity cost for their use also. With the increasing influence of business on the legislative branch of the opposing concept of political rent is more and more relevant, identifies costs that are incurred not only for real resources, but possibly also for artificially created realities.

Rent-seeking

( Main article: rentier economy )

Rent-seeking (of English. "Rent " = lease, rent and "to seek" = aspire, covet ) designated by the neoclassical theory of the behavior of economic actors, which aims to bring about government intervention in the market- mediated allocation of resources in order to artificially hereby to be able to acquire created pension income. Simply put one together including summarizes activities from individuals or interest groups that influence the political process. If rent-seeking is not connected to the bribery of decision-makers (in the sense of corruption), referred to the process as lobbying.

An example of successful rent-seeking would be if a business license for a casino obtained by bribing an official that he can set in an otherwise usable only as a warehouse building. The opportunity cost is the loss in rental revenue for the warehouse.

Rent-seeking is an unproductive activity such as war and defense. That is, there are productive and welfare-enhancing activities (such as manufacturing, services, trade, etc. ) abandoned or otherwise sensibly implemented resources wasted. Rent-seeking, which has been successful, that is individually rational and beneficial but collectively irrational and damaging to the economy.

The yaw effect

As a yaw effect (English " voracity effect" ) refers to a decline in productivity due to conflict-prone rent-seeking activities in welfare -creating reforms. Political rent-seeking increases with the amount of the pension reform. Figuratively speaking, this means there are increasingly used resources in order to secure as large a share of the pie to be distributed. The resources are thus diverted from productive activities to unproductive (ie, influence, lobbying, attack and defense ). Overall, the positive reform is so weakened by the negative effect of resource wastage.