A Culture of Rent-Seeking

Tullock [J Dev Econ 67(2):455–470, 1967] introduced the concept of rent seeking and highlighted the social costs associated with collecting and lobbying for or against tariffs, investing in human and physical capital to facilitate or protect against theft, and expending resources to establish a monopoly. A large portion of the rent-seeking literature suggests how formal and informal institutions impact for rent-seeking activities. Culture also affects rent seeking. Communities can have a culture of rent seeking (CoRS), i.e., a perception shared by members of a society that having influence over political allocations is an important and potentially preferable source of private benefit than other avenues of pursuing economic gain. In this paper, we explore how culture affects the nature and level of rent seeking that a society pursues, and whether institutional shifts can strengthen or break down a CoRS.