The brewer, the baker, and the monopoly maker

Diana W. Thomas, Peter T. Leeson

Research output: Contribution to journalArticle

3 Citations (Scopus)

Abstract

PurposeThis paper seeks to examine how productive entrepreneurial activities, such as innovation, influence unproductive entrepreneurial activities, such as regulatory rent seeking. Design/methodology/approachTo investigate the argument the authors consider Bavaria's brewing industry in the fourteenth through sixteenth centuries using an analytic narrative approach. FindingsThe example of Bavaria's brewing industry suggests that productive entrepreneurial activities may increase unproductive entrepreneurial activities. Confronted with a situation in which innovation erodes their monopoly returns, legally protected producers and policymakers reregulate industry to recapture lost rents. Regulation policy under such reregulation tends to be more encompassing, and thus produces more unproductive entrepreneurial activity, than pre-innovation regulation policy. This reflects the greater number or variety of producers that new regulation policy must encompass for reregulation to recreate rents. Originality/valueThe paper builds on Thomas’ work, which suggests that innovation can undermine existing regulatory institutions and result in deregulation. This paper identifies an alternative channel through which productive entrepreneurial innovation may influence unproductive entrepreneurial rent seeking. It argues that productive entrepreneurial innovation by legally unprotected producers in an industry can also increase, rather than decrease, the extent of unproductive entrepreneurship in that industry.

Original languageEnglish
Pages (from-to)84-95
Number of pages12
JournalJournal of Entrepreneurship and Public Policy
Volume1
Issue number1
DOIs
StatePublished - Apr 20 2012
Externally publishedYes

Fingerprint

baker
monopoly
innovation
rent
brewing industry
rent seeking
Bavaria
producer
regulation
industry
deregulation
sixteenth century
entrepreneurship
Innovation
Monopoly
Entrepreneurial activity
narrative
methodology
policy
Industry

All Science Journal Classification (ASJC) codes

  • Strategy and Management
  • Urban Studies
  • Business and International Management

Cite this

The brewer, the baker, and the monopoly maker. / Thomas, Diana W.; Leeson, Peter T.

In: Journal of Entrepreneurship and Public Policy, Vol. 1, No. 1, 20.04.2012, p. 84-95.

Research output: Contribution to journalArticle

@article{77f2c6b5d8cd48d887171563f1994568,
title = "The brewer, the baker, and the monopoly maker",
abstract = "PurposeThis paper seeks to examine how productive entrepreneurial activities, such as innovation, influence unproductive entrepreneurial activities, such as regulatory rent seeking. Design/methodology/approachTo investigate the argument the authors consider Bavaria's brewing industry in the fourteenth through sixteenth centuries using an analytic narrative approach. FindingsThe example of Bavaria's brewing industry suggests that productive entrepreneurial activities may increase unproductive entrepreneurial activities. Confronted with a situation in which innovation erodes their monopoly returns, legally protected producers and policymakers reregulate industry to recapture lost rents. Regulation policy under such reregulation tends to be more encompassing, and thus produces more unproductive entrepreneurial activity, than pre-innovation regulation policy. This reflects the greater number or variety of producers that new regulation policy must encompass for reregulation to recreate rents. Originality/valueThe paper builds on Thomas’ work, which suggests that innovation can undermine existing regulatory institutions and result in deregulation. This paper identifies an alternative channel through which productive entrepreneurial innovation may influence unproductive entrepreneurial rent seeking. It argues that productive entrepreneurial innovation by legally unprotected producers in an industry can also increase, rather than decrease, the extent of unproductive entrepreneurship in that industry.",
author = "Thomas, {Diana W.} and Leeson, {Peter T.}",
year = "2012",
month = "4",
day = "20",
doi = "10.1108/20452101211208371",
language = "English",
volume = "1",
pages = "84--95",
journal = "Journal of Entrepreneurship and Public Policy",
issn = "2045-2101",
publisher = "Emerald Group Publishing Ltd.",
number = "1",

}

TY - JOUR

T1 - The brewer, the baker, and the monopoly maker

AU - Thomas, Diana W.

AU - Leeson, Peter T.

PY - 2012/4/20

Y1 - 2012/4/20

N2 - PurposeThis paper seeks to examine how productive entrepreneurial activities, such as innovation, influence unproductive entrepreneurial activities, such as regulatory rent seeking. Design/methodology/approachTo investigate the argument the authors consider Bavaria's brewing industry in the fourteenth through sixteenth centuries using an analytic narrative approach. FindingsThe example of Bavaria's brewing industry suggests that productive entrepreneurial activities may increase unproductive entrepreneurial activities. Confronted with a situation in which innovation erodes their monopoly returns, legally protected producers and policymakers reregulate industry to recapture lost rents. Regulation policy under such reregulation tends to be more encompassing, and thus produces more unproductive entrepreneurial activity, than pre-innovation regulation policy. This reflects the greater number or variety of producers that new regulation policy must encompass for reregulation to recreate rents. Originality/valueThe paper builds on Thomas’ work, which suggests that innovation can undermine existing regulatory institutions and result in deregulation. This paper identifies an alternative channel through which productive entrepreneurial innovation may influence unproductive entrepreneurial rent seeking. It argues that productive entrepreneurial innovation by legally unprotected producers in an industry can also increase, rather than decrease, the extent of unproductive entrepreneurship in that industry.

AB - PurposeThis paper seeks to examine how productive entrepreneurial activities, such as innovation, influence unproductive entrepreneurial activities, such as regulatory rent seeking. Design/methodology/approachTo investigate the argument the authors consider Bavaria's brewing industry in the fourteenth through sixteenth centuries using an analytic narrative approach. FindingsThe example of Bavaria's brewing industry suggests that productive entrepreneurial activities may increase unproductive entrepreneurial activities. Confronted with a situation in which innovation erodes their monopoly returns, legally protected producers and policymakers reregulate industry to recapture lost rents. Regulation policy under such reregulation tends to be more encompassing, and thus produces more unproductive entrepreneurial activity, than pre-innovation regulation policy. This reflects the greater number or variety of producers that new regulation policy must encompass for reregulation to recreate rents. Originality/valueThe paper builds on Thomas’ work, which suggests that innovation can undermine existing regulatory institutions and result in deregulation. This paper identifies an alternative channel through which productive entrepreneurial innovation may influence unproductive entrepreneurial rent seeking. It argues that productive entrepreneurial innovation by legally unprotected producers in an industry can also increase, rather than decrease, the extent of unproductive entrepreneurship in that industry.

UR - http://www.scopus.com/inward/record.url?scp=84958527485&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84958527485&partnerID=8YFLogxK

U2 - 10.1108/20452101211208371

DO - 10.1108/20452101211208371

M3 - Article

VL - 1

SP - 84

EP - 95

JO - Journal of Entrepreneurship and Public Policy

JF - Journal of Entrepreneurship and Public Policy

SN - 2045-2101

IS - 1

ER -