Companion to the Political Economy of Rent Seeking
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Companion to the Political Economy of Rent Seeking

Edited by Roger D. Congleton and Arye L. Hillman

The quest for benefit from existing wealth or by seeking privileged benefit through influence over policy is known as rent seeking. Much rent seeking activity involves government and political decisions and is therefore in the domain of political economy, although it can also take place in personal relations and within firms and bureaucracies. Rent seeking, which involves the unproductive use of resources, is however primarily associated with policies that create rents as well as rent extraction or political benefit for the creators of rents. The contributions in this outstanding volume provide an accompaniment or “companion” to the literature on rent seeking and the related political economy of rent creation and extraction. The chapters, written by leading scholars in the field, demonstrate the centrality of rent-related incentives to the study of economics, politics, culture, public administration and history.
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Chapter 16: Rent seeking in international organizations

Roland Vaubel


The chapter analyzes rent seeking by international organizations and through international organizations. Rent seeking by international organizations is more pervasive than rent seeking by national bureaucracies to the extent that the information cost of politicians and voters is higher but less pervasive to the extent that politicians have less to fear from international bureaucrats than from national bureaucrats. The chapter presents evidence that international organizations charge higher input prices, employ too large quantities of input and demand excessive budgets. Agency slippage is shown to increase with the number of member states. Rent seeking through international organizations is typical of private interest groups. Special interest groups are more powerful at the international than at the national level to the extent that the information cost of voters is higher and international bureaucrats are less controlled by politicians who want to be re-elected. The chapter presents evidence of the power of interest groups in international organizations. It concludes with a number of recommendations on how rent seeking by and through international organizations could be reduced.

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