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17 Jul 2019
Movement for change
Suggestion View - 247
Combat rent seeking activities

Have you heard of the term "rent seeking"?

The definition is:
Rent-seeking is an attempt to obtain economic rent (i.e., the portion of income paid to a factor of production in excess of what is needed to keep it employed in its current use) by manipulating the social or political environment in which economic activities occur, rather than by creating new wealth.

The Singapore economy has a large portion of rent seeking activities.

For example, the government uses its control over the land supply to push up the land price to high level. Who benefits from the high price? The government!

It is a form of exploitation.

While the additional revenue from land sale by the government is supposed to benefit the people at large, there are ways for the rent seeking wealth to filter to certain groups of people or related parties, sometimes described as the "cronies", who gain a larger share of the benefit.

There are many other forms of "rent seeking activities" in Singapore. We should find ways to combat them.

What happens if the government stops its rent seeking activities in respect of land prices?

It means that the ordinary people can have their HDB flats or private housing at lower prices and that businesses can have their premises at lower rents. It will reduce the cost of living and the cost of doing business. It will make Singapore more competitive.

This will be better for the future of Singapore. 

Tan Kin Lian

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