Professional power and rent seeking: Theoretical assumptions and empirical findings on Polish insolvency system
Sociology Instytut Socjologii UMK Torun, Poland
This paper utilises findings of rent seeking theory and sociology of professions. Sociology of professions analyses how occupational groups solicit for their professional status and power. Theory of rent seeking on the other hand studies how people compete for political rent ? that is redistributive transfers granted by political power. Economists examining rent seeking phenomenon has came to conclusions that it causes extensive waste of resources and hinders growth of a given economy.
The basic presumption of this paper is that, professional discretionary power allows generating political rent too. Referring to empirical data on Polish insolvency system, where two professional groups ? insolvency court judges and receivers ? play significant role, the paper analyses the sources and scale of possible transfers and waste of resources with use of professional power. Importance of insolvency systems for the fluency of national economies rise in the time of crisis as the number of bankruptcies rise.
In conclusions, the paper arguments that the economic measures of waste and transfers caused by rent seeking are insufficient to evaluate all the consequences of this phenomenon for economy. Use of professional power for rent seeking call for analyse from institutional and social perspectives. Rent seeking often involves illegal actions and brings about misuse and deformation of subjected institutions. Consequences including fall of social capital and rise of total transaction costs constrain economy and discourage enterprising and innovative behaviour.