I haven’t had much time for blogging lately but I’m going to try to get back into the swing of things. Back in December, I had this to say in Real Clear Markets:
The eminent political economist (and my former professor) Gordon Tullock, passed away last month at the age of 92. His greatest contribution to economic understanding was a funny-sounding concept: “rent seeking.” Funny sounding or not, this idea-perhaps more than any other economic idea developed in the last century-explains what ails our moribund economy. And, as strange as this may sound, a pair of rock star dinosaur hunters form the 1880s can help us understand what exactly rent seeking is and why it’s such a problem.
You can read the rest here. FYI: I didn’t choose the title and am not crazy about it.
Advocates of corporate welfare often claim that when governments privilege a handful of firms, the rest of the economy somehow benefits. This is how the Bush Administration sold the bank bailouts. It’s how the current Administration sold the auto bailouts. And it’s how the U.S. Chamber of Commerce is trying to sell the Export-Import Bank.
Mounting evidence, however, suggests the opposite is true: economies whose firms sink or swim based on political patronage grow slower and are less stable than those in which firm success depends on an ability to meet the market test.
That’s me, writing at Real Clear Markets. I’ve always thought that if there were any justice in the English language, “trickle-down economics” would not refer to general tax cuts, but would instead refer to any scheme to privilege particular firms or industries in hopes that their greater prosperity will somehow trickle down to the rest of the economy. I was glad that the editor took my suggestion for the title. Click here to read more.