What is economic rent and why is it important?
An economic rent is an excess income above the normal levels in competitive markets. Economic rent is caused by possession of a scarce or exclusive factor. Examples of natural scarce…
Definitions of economic rent by Adam Smith, Ricardo and others
Adam Smith (1776), The Wealth of Nations, chapter 6: "As soon as the land of any country has all become private property, the landlords, like all other men, love to…
Literature 1817 – 1900, David Ricardo and Henry George
David Ricardo (1817) is regarded as the father of economic rent. Previous authors including Adam Smith did write about rent, but their analysis was not precise and sometimes inconsistent. The…
Literature 1900 – 2008, Neoclassical economics and neoliberalism
In the 20th century economic theory was dominated by the neoclassical approach. Neoclassical theories focus on markets with perfect competition, complete information, no uncertainty, and rational humans. Given these assumptions,…