Page 22 - Issue-27

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there is no need to improve the exports. Also, in the case of a large country

with a large population, the internal rent can be considered non-competitive,
since it promotes this “good relationship ” between businessmen and the

government.
Furthermore, this economic structure is politically problematic. First, income

from rent substitutes tax revenues, which reduces the accountability of these

governments and the representation of the people in the political decision-
making. When the government takes a portion of the people ’s income to build a

public project, they pay close attention to how their money has been spent, and
they start expressing their displeasure as soon as they find that those taxes are

no longer worth their price. Likewise, direct remittances are a relief from
difficult living conditions. Yet, this relief prevents the remittance receiver from

feeling the economic and social problems, such as poverty and unemployment,

and thus discourages him from calling for government reforms. Finally, the rent
reduces the role of the State to the simple distributor of the rent. This

distribution can manifest itself in a wide variety of forms, the most observable
of which is the financing of the public sector which could be considered as a

means of buying the political loyalty of its population. If his boss offers a good
salary, social security and requires little work, the employees will never go on a

strike.

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