ABSTRACT
Rent represents a core building block in neoclassical economic theory. Broadly defined, rent equals profit—total revenues minus opportunity costs—which makes it the chief purpose of economic activities. “Rent is that part of the payment to an owner of resources over and above that which those resources could command in any alternative use” (Buchanan, 1980, p. 3). Various models of economic action—maximizing, satisficing behavior and the minimization of missed opportunities (see Chapter 6)—all imply that the actor appropriates some rent. However, a simple search in the Google database suggests that the relative importance of different forms of rent depends on the institutional environment. The expressions “administrative rent” and “resource rents” can be found with the relative frequencies of 2.2 to 1 in Russian-language documents whereas their ratio appears completely reversed in English-language documents (1 to 34.5). 1
