Rent Intensity and Economic Mediocrity

Raul Fabella

Philippine Review of Economics, 1994, vol. 31, issue 2, 73-85

Abstract: Using the share society as a metaphor for the economic system, we construct a microfoundation for the stylized observations about rent-seeking and economic performance. We introduce the concept of rent intensity and show that at symmetric Cournot-Nash equilibrium it falls as value-adding productivity rises, rises with rent-seeking reward and with number of participants. Finally, average output falls with population growth where rent-seeking overwhelms increasing return to scale.

Date: 1994
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Persistent link: https://EconPapers.repec.org/RePEc:phs:prejrn:v:31:y:1994:i:2:p:73-85

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