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Rent seeking for export licenses: Application to the Vietnam rice market

Author

Listed:
  • Tan Ngoc Vu

    (Business and Economics Research Group Ho Chi Minh City Open University, Vietnam.)

  • Duc Hong Vo

    (Business and Economics Research Group Ho Chi Minh City Open University, Vietnam.)

  • Michael McAleer

    ( Department of Quantitative Finance National Tsing Hua University, Taiwan and Econometric Institute Erasmus School of Economics Erasmus University Rotterdam, The Netherlands and Department of Quantitative Economics Complutense University of Madrid, Spain And Institute of Advanced Sciences Yokohama National University, Japan.)

Abstract

The paper develops a model to examine rent seeking in innovation and export licenses, with an application to Vietnam rice exports. Firms can lobby for export restrictions or for free trade. Innovation is introduced as a cost-reducing technology. The analysis focuses on the innovation incentives of the firm lobbying for export restrictions, and the determinants of lobbying incentives. The analysis shows that firms lobbying for export restrictions may have lower incentives to adopt technological innovations under export restrictions than under free trade. The findings can help to identify economic inefficiency when the political elites use export restrictions to seek rents.

Suggested Citation

  • Tan Ngoc Vu & Duc Hong Vo & Michael McAleer, 2019. "Rent seeking for export licenses: Application to the Vietnam rice market," Documentos de Trabajo del ICAE 2019-13, Universidad Complutense de Madrid, Facultad de Ciencias Económicas y Empresariales, Instituto Complutense de Análisis Económico.
    • Handle: RePEc:ucm:doicae:1913
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    References listed on IDEAS

    as
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    Keywords

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    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • G1 - Financial Economics - - General Financial Markets
    • L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation

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