Wednesday, August 12, 2009

The 'rent' and the 'return'

Books of Account
The Dynamics of Competition
K. Pushpangadan and N. Shanta
( http://www.oup.com/)

Rent-seeking behaviour

A disturbing finding about rent-seeking behaviour, in a recent book from Oxford University Press, is that in all industries, on an average, the rate of return is nearly double that of the estimated competitive return. The rent component and competitive return are more or less equal, observe K. Pushpangadan and N. Shanta in The Dynamics of Competition: Understanding India’s manufacturing sector.

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