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The social cost of contestable benefits

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  • Arye Hillman
  • Ngo Van Long

Abstract

A major contribution of the public-choice school is the recognition by Gordon Tullock that contestable rents give rise to social losses because unproductive resource use. The contestable rents usually are politically assigned privileges. Contestable rents can also be found outside of government decisions. We describe the example of academia. The primary empirical question concerns the magnitude of the social loss from contesting rents. Direct measurement is impeded by lack of data and indeed denial that rent seeking took place. Contest models provide guidance regarding social losses. The social losses diminished because rent seeking in high-income democracies usually takes place by groups seeking collective objectives. Also accountability in democracies requires that rents be assigned in indirect ways that increase inefficiency in other respects. The proposal that rent seeking exists can have an ideological dimension. Une contribution majeure de l’école de choix public est la reconnaissance par Gordon Tullock que les privilèges contestables entraînent des pertes sociales à cause de l’utilisation de ressources improductives. Les privilèges contestables sont habituellement des privilèges attribués politiquement. Des privilèges contestables peuvent également être trouvés en dehors des décisions du gouvernement. Nous décrivons l’exemple du milieu universitaire. La principale question empirique concerne l’ampleur de la perte sociale des privilèges contestataires. La mesure directe est entravée par le manque de données et même le refus que la recherche de privilèges ait eu lieu. Les modèles de concours fournissent des conseils concernant les pertes sociales. Les pertes sociales ont diminué parce que la recherche de privilèges dans les démocraties à revenu élevé est généralement effectuée par des groupes qui ont des objectifs collectifs. En outre, la responsabilité dans les démocraties exige que les privilèges soient attribués de manière indirecte, ce qui augmentent l’inefficacité. La proposition selon laquelle la recherche de privilèges existe peut avoir une dimension idéologique.

Suggested Citation

  • Arye Hillman & Ngo Van Long, 2017. "The social cost of contestable benefits," CIRANO Working Papers 2017s-11, CIRANO.
  • Handle: RePEc:cir:cirwor:2017s-11
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    Keywords

    Rent seeking; contests; political discretion; academic merit; ideology.; Recherche de privilèges; concours; discrétion politique; mérite académique; idéologie.;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions

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