Assignment

Using the arguments in this week's readings (and last weeks, if you wish), explain how a market-oriented economic dynamic drives economic progress (wealth creation). Then explain, in explicit cause-and-effect terms, how rent-seeking undermines the wealth-creation process.

If you wish, here's an outline you can use to organize your thoughts:

• What does John Kay mean when he says: "Market economies do not predict the future, they explore it"?
• How does Buchanan explain "social surplus" ("rent creation" or Kay's added value) as an outcome of an "ordered market structure"?
• Based on your answer to the previous bullet-points, how would you harmonize Buchanan's idea of an "ordered market structure" with John Kay's term "disciplined pluralism" in order to describe the process of creative destruction?
• Among the assigned readings, which way of defining rent-seeking do you find most intuitive?
• How would you harmonize your chosen definition with the idea that one form of rent-seeking equates to "organized resistance" to economic change?
• How would Blank, Buchanan, and Kay argue that rent-seeking in the form of organized resistance undermines the process of creative destruction?