Rent Seeking in the Cameroon Economy: Krueger's Analytic Technique Helps to Account for Development Lag in Colonial States
Traditional economic theory regards the social costs of monopoly as the reduction in both consumer and producer surplus as a result of monopolization of certain sectors of the economy. Recent research has shown that a proper accounting of the social costs of monopoly must include the costs of obtaining and maintaining monopoly positions. Anne 0. Krueger used the term "rent seeking' to refer to the expending of scarce resources by entrepreneurs to fight for rents created through government activity in the economy. Excessive interference in the economy by government can result in an increase in the social costs of monopoly. In a developing country such as Cameroon, where government activity in the economy has been quite pervasive since the latter part of the 1800s, opportunities have been created for rent seeking. This type of activity has helped to impede the economic growth of the country.