Title: What Is Rent-Seeking Behavior?
Headings: What Is Rent-Seeking Behavior?
What Is Rent-Seeking Behavior?
Content: Having more than your family needs opens the opportunity to trade the excess for profit. Unfortunately, when property rights are weakened and the ownership of someone's wealth or goods is debatable, people can gain more by trying to appropriate that wealth than by producing themselves. This behavior is called rent-seeking. Rent-seeking frequently requires spending your own resources so you own someone else's surplus in the end. In the public sector, for example, government lobbyists are hired to sway public policy to benefit their companies and punish their competitors. Although hiring lobbyists clearly benefits the company they represent, the work of lobbyists does not add value to the larger marketplace. If property rights on the surplus the company seeks had been more stable, such roles for lobbyists would never have been created. Rent-seeking doesn't add any national value. It is coerced trade and benefits only one side. Rent-seeking can include piracy, lobbying the government or even just giving away money.