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Rent-Seeking Behavior

In economics and political science, rent-seeking behavior refers to situations in which an individual or a group attempts to gain economic benefits through actions in the political arena. Typical examples include lobbying for advantages (such as protection from international competition or subsidies) by industry groups or unions, or attempts by firms to appropriate monopolies controlled (and often purposefully created) by the state. A key insight of the literature is that an agent engaged in rent-seeking will be willing to devote resources to the rent-seeking activity that are almost as large as the benefit that the agent is attempting to capture. For example, if an interest group is seeking to gain benefits worth X million dollars, it will be in their interest to spend almost the ...

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