The rise and decline of regional power: A historical case-study of privilege seeking

This paper comprises one of Olson's findings about the rise and decline of nations and Tullock's idea of privilege-seeking. In the historical framework of Northern Europe the history of a town being closely linked with its saltern is investigated. It is shown that throughout the centuries rent- and privilege-seeking dominated. This was primarily done to avoid competition and, finally, to get excessive revenues. The sovereigns' production-costs of the privileges were low and Tullock's results of an efficient transfer mechanism are confirmed. Additionally, the findings of coalition-forming and mortgaging support the inevitable sclerotic process. Market activities find their political counterparts which is illustrated by the building and destroying of specific coalitions. A typical delay of privilege- and coalition-seeking is observed depending on the economic and political success. Regulatory measures are explored then "exploited", and allies are found, "utilized" and dropped, finally leaving certified rents of no value. © 1994 Kluwer Academic Publishers.