This paper develops a model of rent-seeking in which the opportunity cost of rent-seeking is foregone entrepreneurship. It provides conditions under which resource booms tend to lead to an increase in rent-seeking activity and those in which they induce entrepreneurship. It is shown that the effects of a resource boom depend critically on the number of rent-seeker/entrepreneurs in an economy.
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Paper provided by Notre-Dame de la Paix, Sciences Economiques et Sociales in its series Papers with number
191.
Length: 18 pages Date of creation: 1997 Date of revision: Handle: RePEc:fth:nodapa:191
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Find related papers by JEL classification: D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Models of Political Processes: Rent-seeking, Elections, Legislatures, and Voting Behavior
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