Title: Rent-seeking - Definition, Common Examples, and Tullok Paradox
Headings: Rent-seeking
Rent-seeking
What is Rent-seeking?
Origins of Rent-seeking
The Tullock Paradox
Examples of Rent-seeking Activities
Related Readings

Content: The Tullock Paradox
The corrupt politicians utilize their bureaucratic power to engage in rent-seeking activities. In order to gain certain benefits, the rent-seekers may bribe politicians. However, G. Tullock determined that there is a significant difference between the cost of rent-seeking (bribery) and the gains from this practice. This paradox is called the Tullock Paradox. The Tullock Paradox states that rent-seekers generally obtain large financial and economic gains at an enormously small cost. This cost-benefit discrepancy stems from several possible explanations: In democratic states, there is somewhat more transparency for voters to monitor the behavior of the politicians. Therefore, if a politician is corrupt and takes a bribe, it may be discovered, and voters can penalize the corrupt politicians by not reelecting them, or he may be criminally charged. Another force that determines the costs for rent-seekers is whether there is competition among politicians. If there are different politicians that can ensure the delivery of certain benefits to rent-seekers, then the competing politicians will push down the cost of rent-seeking.