(18 pts.)

REMEMBER:  Never copy and paste from the handouts or the internet.  Use your own words.

Copy and paste into a word document and then type your answers.  Graphs do not have to be typed.

1.  Explain how the violence of faction and rent seeking are related by discussing why there would be more rent seeking take place if there is more "violence of faction" taking place. (5 pts.)

2.  Provide/explain a real world example (other than what we discussed in class, i.e., the Super Bowl or Olympics examples) of how/why socially harmful rent seeking need not be limited to government policy. (5 pts.)

3.  Graphically and in words, explain why the cost of rent seeking is more than simply the "welfare" loss of trade due to a government-granted monopoly position (as explained by mainstream economic analysis and Tullock).  Assume a constant marginal cost (or horizontal supply curve).  Clearly show on your graph where the "welfare or deadweight" loss is with ABC -- but also where the other loss is and explain in words where it comes from. (8 pts.)

Extra Credit:

Find an interesting figure (number) that relates to rent seeking (besides what we have looked at in class) - provide the number and the source and explain how it is related to rent seeking (not just by businesses).  Be creative and think of something that interests you but is related to rent seeking or lobbying.

OR

Billionaire financier George Soros has given $8 million to support Hillary Clinton's campaign.  See if you can find evidence as to exactly what Soros wants in return?  What is he rent seeking for?