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Some thoughts on rent-seeking protectionists from more than a century ago…. – Publications – AEI

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AEI Some thoughts on rent-seeking protectionists from more than a century ago…. …. are from Cornell University professor of political economy and finance Frank A. Fetter‘s 1905 textbook The Principles of Economics, With Applications to Practical Problems: A tariff is immediately favorable to some enterprises and to special classes of workmen. Enterprisers already acquainted with and engaged in a business always may hope to gain by the higher prices immediately following a rise in the tariff rates on their particular products. Though they are granted no enduring monopoly by the protection, they for the time enjoy the advantage of being on the ground and reap the first fruits of the favoring conditions. The enterpriser usually profits when the price of his product suddenly rises. The burden

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Some thoughts on rent-seeking protectionists from more than a century ago….

Some thoughts on rent-seeking protectionists from more than a century ago…. - Publications – AEI…. are from Cornell University professor of political economy and finance Frank A. Fetter‘s 1905 textbook The Principles of Economics, With Applications to Practical Problems:

A tariff is immediately favorable to some enterprises and to special classes of workmen. Enterprisers already acquainted with and engaged in a business always may hope to gain by the higher prices immediately following a rise in the tariff rates on their particular products. Though they are granted no enduring monopoly by the protection, they for the time enjoy the advantage of being on the ground and reap the first fruits of the favoring conditions. The enterpriser usually profits when the price of his product suddenly rises.

The burden of higher prices is very soon distributed to a number of less favored citizens. A part of it may be borne by the retail merchant, a part by his customers. The weight falling on each is usually small, often unsuspected, always hard to measure. The increased benefit is concentrated in a few industries and accrues to a comparatively few producers.

Here is a recipe for riches: get everybody to give you a penny; they’ll not miss it, and it will mean a great deal to you. Something like this happens in the case of many protected industries; every consumer of the article pays a penny more, a few wage-earners gain, and a few enterprisers wax wealthy.

MP: I think by “enterprisers” Professor Fetter means “rent-seeking, protectionist crony capitalists who engage in the legal plunder of their fellow citizens for their own personal gain.”

Some thoughts on rent-seeking protectionists from more than a century ago….
Mark Perry

Mark Perry
Mark J. Perry is concurrently a scholar at AEI and a professor of economics and finance at the University of Michigan’s Flint campus. He is best known as the creator and editor of the popular economics blog Carpe Diem. At AEI, Perry writes about economic and financial issues for American.com and the AEIdeas blog.

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