Rent Economy

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A rent economy is a form of economy in which the actors do not achieve prosperity to a large extent through their own contribution and productive use of factors, but through the exploitation of structurally conditioned shortages that are stabilized to the detriment of the general public and are not overcome by higher production .

Definition of pension

In general, annuities are the portions of earnings, incomes and payments that exceed their opportunity cost ; H. the excess over the regular "value" of the economic factors used ( labor , capital , raw materials , know-how, etc.). The pension results from a short-term shortage situation ( demand over supply ), which enables a price increase without a higher value. Such shortages can be the result of natural location factors , the strong market power of the providers (e.g. monopoly rent or, rarely, monopoly yield ), but also deliberately created shortages, often through state regulations and interventions.

Such pensions occur in every economic system , but to a very different extent. The acquisition can take place legally and illegally. In developing countries, the so-called “international pension”, which consists of transfers from development cooperation, is not insignificant .

Rent-Seeking

Under competitive conditions, high rents normally lead to production being optimized in order to reduce the scarcity of an asset and thus also its temporarily increased price. Rent-seeking, on the other hand, ie the activity seeking rent , does not attempt to reduce the scarcity of the goods, but rather to use the pension situation specifically to maximize individual benefit. From an economic point of view, this approach must be viewed critically, because resources are expended for appropriation and participation in pensions, which are no longer available for a more productive use of factors ( efficiency ). The expenses in the context of rent-seeking processes include: money, time, obtaining information, initiating contacts, organizing interests , preventing competition, legal and illegal means of influencing (institutionalized) decisions (e.g. lobbying , corruption ).

Rent-seeking can be promoted by state or supranational interventions or protectorates : when attempts are made to end market failure by means of protectionism or to accelerate the ( industrial ) development process. In this context, the susceptibility of foreign trade measures ( foreign exchange , customs duties , licenses ) to rent-seeking becomes clear .

Price fixing and a monopsonistically structured agricultural economy can favor the skimming off of export earnings by the power elites who rule a state that is prone to rent-seeking. Foreign companies may be tempted to profit from this rentier mentality and the low social responsiveness of such regimes ; The purely profit-oriented bypassing of wage and environmental standards that apply elsewhere ultimately helps to stabilize the ruling clique . Shell's involvement in Nigeria can be seen as a critical example of this .

Reindeer states

The concept of the " rentier state " was first introduced into economic literature by Hossein Mahdavy in 1970. It refers to states that receive a large proportion of their state income from external pensions . External pensions are paid to the state concerned by foreigners, be they foreign companies, governments or individuals (for example, the income from the fees for passage through the Suez Canal is an external pension). Income from the transport of Russian natural gas through Ukrainian territory also counts as external pensions. Also, revenue from oil production can be interpreted as an external pension: Usually royalties regarded as compensation for the consumption of non-renewable resources. However, the oil-exporting countries in the Middle East , especially the Gulf States , benefit from a producer's surplus, which results on the one hand from the higher productivity of Arab regions compared to other production areas and from monopoly pricing structures. The oil revenues are also not related to the other domestic economic activity of these countries. Government revenues from the country's other economic activities are low.

The high income from external pensions often leads to misallocations, such as high concentration in a few locations, hardly any industrial exchange within the country, weakening of traditional economic sectors due to misallocation of resources and thus below-average economic growth.

This financial independence of the “state-supporting” groups (or groups that take control of the state) from their own people - at least as history has shown so far - allows them to neglect the development of future possible domestic sources of finance. Inadequate institutional framework conditions are not improved and neither legal certainty nor transparency nor political competition or expenditure control are sought.

The rentier state can “use transfer payments in a targeted manner in order to induce social groups to behave in a politically opportune manner. Political loyalty (or at least renouncing open opposition) is rewarded by granting subsidies or creating jobs in the state bureaucracy ” .

In particular, the close interlinking of political office and economic opportunities ( neopatrimonialism and clientelism ) could also result in financial decline for the ruling elite if political alternatives were allowed. Excessive government spending therefore usually meets with little resistance or is enforced through repressive and authoritarian politics ( autocracy ). The rentier mentality, which is contrary to efficient management, is promoted and the rent-seeking behavior ultimately also leads to corruption and widespread patronage relationships . Thus, finally, the state expertise and ultimately is legitimacy eroded, state failure threatens and z. B. - and especially - in Africa (e.g. in countries with large deposits of diamonds or oil) this is often the result.

literature

  • Michael Dauderstädt, Arne Schildberg (Ed.): Dead Ends of Transition. Rentier Economies and Protectorates. Campus Verlag, Frankfurt am Main 2006, ISBN 3-593-38154-0 .
  • Dirk Löhr : The pension economy principle - when property becomes theft , Metropolis-Verlag, Marburg, 2013, ISBN 978-3-7316-1013-7
  • Hossein Mahdavy: The Pattern and Problems of Economic Development in Rentier States. The Case of Iran. In: MA Cook : Studies in the economic history of the Middle East. From the rise of Islam to the present day. Oxford University Press, London et al. 1970, ISBN 0-19-713561-7 , pp. 428-467 ( School of Oriental and African studies ).
  • Florian Mayer: On the importance of pension income for the political and economic development of the MONA region: past, present, future. online (PDF; 166 kB) .
  • Friedrich Mühlenberg: Rent Economy. In: Rolf Hofmeier, Andreas Mehler (Hrsg.): Kleines Afrika-Lexikon. Beck, Munich 2004, ISBN 3-406-51071-X ( Beck'sche series 1569).
  • Claudia Schmid: Pension and the rentier state. A contribution to the history of theory. In: Andreas Boeckh, Peter Pawelka (ed.): State, market and pension in international politics. Westdeutscher Verlag, Opladen 1997, ISBN 3-531-12930-9 , pp. 28-50.
  • Douglas A. Yates: The Rentier State in Africa. Oil Rent Dependency And Neocolonialism in the Republic of Gabon. Africa World Press, Trenton NJ et al. 1996, ISBN 0-86543-520-0 .
  • Hartmut Elsenhans : The international system between civil society and pension. Münster / Hamburg / London, LIT, 2001, ISBN 3-8258-4837-X .
  • Mushtaq H. Khan and Kwame Sundaram Jomo (eds.): Rents, Rent-Seeking and Economic Development. Theory and Evidence in Asia. Cambridge: Cambridge University Press 2000. ISBN 978-0-521-78866-3

See also

Individual evidence

  1. ↑ See Yates , Rentier State, 1996, p. 11.
  2. ↑ See Mahdavy , Pattern, 1970, p. 428 f.
  3. ↑ Küpeli, Ismail Revolte with a limited range , analysis & criticism , No. 559, March 18, 2011, p. 8