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@conor64 @Meegs343434 @jeffreypavlak @hamiltonnolan @ClaraJeffery let’s set aside the term “rent-seeking”, which would have us arguing over whether a pejorative valence is merited. what is almost certainly true is that extraordinary wealth doesn’t accumulate without some sort of barrier to competition taking hold. in some cases, how that 1/
@conor64 @Meegs343434 @jeffreypavlak @hamiltonnolan @ClaraJeffery happens is largely “innocent”. Oprah did not “rent seek”, but she’d not have accumulated her fortune had network effects associated with celebrity magnified the effect in outcomes of any difference between her very real talents and those of other similarly situated aspirants. 2/
@conor64 @Meegs343434 @jeffreypavlak @hamiltonnolan @ClaraJeffery Her fortune is “rent” by definition in the sense that the rewards she accumulated were above and beyond what would have been necessary to motivate a competitor to perform the same work if, counterfactually, there was no Matthew Effect in fame that leaves no one similarly 3/
@conor64 @Meegs343434 @jeffreypavlak @hamiltonnolan @ClaraJeffery situated. The question is, should we celebrate the rents that emerge from this kind of “innocent” source of competitive barriers as a legitimate part of the value production process, or should we, as a matter of policy, consider rewards far above and beyond what would be 3/
@conor64 @Meegs343434 @jeffreypavlak @hamiltonnolan @ClaraJeffery necessary to motivate the activity as undesirable, and so claim “every billionaire is a policy failure”. Obviously there’s a case to be made both ways. Who knows the counterfactual if the tax system were structured so people could only ever become hundred millionaires? But one 5/
@conor64 @Meegs343434 @jeffreypavlak @hamiltonnolan @ClaraJeffery key point is that, if we do imagine there are “innocent” as well as nefarious rents, legitimizing those we judge innocent creates tremendous incentive for gaming—rent-seeking, regulatory capture—that can hide in the skirts of that. Again, there’s no ironclad argument here, /6
@conor64 @Meegs343434 @jeffreypavlak @hamiltonnolan @ClaraJeffery because we cannot see the counterfactuals. But it’s a very reasonable judgment call a lot of us make, I think, to say that the behavioral effect of the next $100M after the first is mostly positional (so no motivation would be lost if all the status competitors faced the same 7/
@conor64 @Meegs343434 @jeffreypavlak @hamiltonnolan @ClaraJeffery compressed scale, and that looking around in the actual timeline, the costs of tolerating rent accumulation and creating ambiguous spaces in which rent-seeking and regulatory capture are justified seem much larger than the cost of simply tolerating less accumulation of reward 8/
@conor64 @Meegs343434 @jeffreypavlak @hamiltonnolan @ClaraJeffery and so dramatically diminishing the incentives to engage in those bad practices. /fin, finally, sorry
