On Perfect Rent Dissipation

摘要: If economists are united on anything, it is the proposition that monopoly prices reduce economic welfare by preventing realization of maximum gains from trade in any market. The extent such distortions to efficiency often called Harberger costs after Arnold Harberger's 1954 provocative attempt measure these losses U.S. economy. More recent analysis has revealed when power achieved via regulation, at least part rents so gained will not be simple transfers consumers producers, but dissipated producers' rent-seeking activity. Since activity employs real resources, there additional monopolization beyond as emphasized Gordon Tullock (1967) and Richard Posner (1975). Indeed, others have argued if competition for perfect, all expected regulation converted losses. While Franklin Fisher's 1985 comment qualified this conclusion somewhat, upshot debate rent-seeking, or Tullock, costs, may greatly exceed costs.1 Another strand concerns time pattern over which returns gain hold right. Robert McCormick et al. (1984) emphasize expenditures sunk, they forever lost recoverable deregulation. conceding point, Martin Cherkes (1986) argue most rentseeking recurring, therefore large deregulation remain. purpose essay point out that, recurring even largest specification regulatory fall far short actual costs. This because concentrates largely ignores parallel rent-defending2 A proper assessment rent-defending might more than double suggested Posner.