Robert Tollison, one of America’s premier students of public choice and government, defines rent-seeking this way: “Rent seeking is the expenditure of scarce resources to capture an artificially created transfer.” Competition for government goodies—rent-seeking—is a wild goose chase, no matter how well-intentioned the goose or the chasers.
The city official told me that his office employed 15 people whose sole jobs were to identify and win federal grants. Their total salaries, and the staff and utilities required to support them, exceeded one quarter of the federal funds they had secured in grants the previous year. It seems like a pretty good deal to spend only 25 cents to win a dollar. But if you think about all the other cities doing the same thing, you realize that this system of distributing grants has some pretty perverse costs.
Michael Munger, Rent-Seek and You Will Find | Library of Economics and Liberty
