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Without development there's no profit, while not profit no development," wrote social scientist and social scientist economic expert in his landmark book the idea of Economic Development. An open question, however, has been whether or not excess profits—known as rents—are smart for development. theory up to now supports either side of the argument, yielding conflicting recommendation for competition policy and anti-corruption efforts. This paper examines the question by analyzing a comprehensive industry—level data set of producing sectors—and by applying ways of the competition-and-growth scholarship of social scientist Philippe Aghion and colleagues. This approach permits the analysis of industry-level gain (as opposition individual firms) and also the overall growth of the economy. proof suggests that rents, as measured by a high-markup that's additionally a sign of low competition, appear to slow growth in productivity or output. The result is strongest in poor countries. Higher rents ar related to a slower removal of tariffs, implying that corporations rent-seek to forestall competition and maintain their high margins. This investment in rent-seeking could also be in stead of investment in innovation or new productive assets, that slows the general growth of the world. moreover, in industries within which high profits ought to be essential in generating growth, those sectors that will otherwise would like external finance however in a very country with weak money markets, the negative impact of rents on growth is very robust. Findings additionally show that countries with additional rents within the producing sector grow slower even once different controls ar introduced
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