Changes in budgetary allocations and international comparisons of the social cost of rent-seeking: A critical note

The Katz-Rosenberg measure of rent dissipation across countries fails to encompass the consequences of different political systems wherein allocations are made. Observations about fiscal federal structures and the particular political structures of different countries affect political discretion in allocating government transfers. Owing both to the absence of these considerations, which are indeed self-evident, and some other considerations regarding the measure, the cross-country rankings that Katz and Rosenberg present are meaningless at best and, at worst, misleading.