Rent-seeking measurement in coal mining by means of labour unrest: an application of the distance function
AbstractWe propose a method based on the distance function to empirically estimate the social cost arising from rent seeking behaviour in declining industries. Due to import competition, the factors of a particular industry undergo losses in real income, and have incentives to seek protection. In the case of declining industries, workers play a central role and the losses in output due to strikes are used to quantify the social cost of rent seeking. In our model, strikes are considered as a “bad” input into the production process. We apply our approach to the case of Spanish coal mining. We have estimated a system of equations formed by the input distance function and cost share equations using annual data over the period 1974-1997. This procedure has allowed us to calculate the cost that strikes have imposed on the sector
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 3682.
Date of creation: 2002
Date of revision:
Publication status: Published in Journal of Productivity Analysis 27.1(2007): pp. 73-83
Production theory; rent seeking; input distance function; shadow prices; coal sector;
Find related papers by JEL classification:
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
- D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- L71 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Mining, Extraction, and Refining: Hydrocarbon Fuels
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