Global Resource Estimates from Total Petroleum Systems Book

Rent-seeking is the idea that a few special interested parties, whether groups or individuals, obtain privileges which allow them to extract a rent. The rent is the income derived due to the special privilege, it is not income via wealth producing methods. The more a society has rent-seeking, the more produce is taken away from other sources, hindering the society's allocation of resources. Rent-seeking, in Tullock's view, is a result of a policy that has more costs to society than benefits.

Rent-seekers will do as much as they can to obtain their special privilege, but the special privilege is not a certainty. Tullock uses the main example of lobbying efforts that allow for a chance to obtain a special privilege which provides a rent. Others will lobby to avoid paying a rent, procuring exemptions in laws that would hinder them. Overall, rent-seeking takes away resources away from the economy to use for socially destructive purposes, even though a particular group will gain from their rent-seeking effort. Tullock's research helped economists understand that the loss to society from rent-seeking is far more than thought of previously.

The problem with this story is that rent-seeking is seen only as a result, rather than a process. Many examples were provided showing how the rent-seeking efforts were undertaking, but the process itself is not rent-seeking. Tullock does point out that if some rent is required, that there are more efficient ways of benefiting the special interest groups than the way the groups are currently being benefited. The reason for the inefficient method in practice, as explained is due to the problem that the more efficient way would not be politically feasible. It would have helped the book should he better explain the process and their undercurrents than just a myriad of specific examples.

History does play a role in the explanation of the rent-seeking behavior, such as England. England having at one point most of the national product go to rent-seekers while later changing the institutions to prevent massive rent-seeking. Culture and history should have played a more prominent role in explain the property right changes that occurred to make certain societies more or less prone to rent-seeking. The information incentives of voters was a major explanation of rent-seeking.

Tullock used game theory and a few models to illustrate the problem of rent-seeking. The game was insightful for understanding rent-seeking, but unless some basic game theory is known prior to reading the book, the reading of those parts would be more difficult. Most of the book are eloquently and stark examples of rent-seeking behavior.