
Theory of Rent 217
3. ‘From the point of the view of the industry or of society as a whole [economic rents] are price
determined’, not price determining
8
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e modern view is a very slippery one. If applied to the real-life situations, numerous diculties are
encountered. For example, suppose that a business manager is earning Rs 90,000 a month in a company
and, in his own business, he expects to earn only Rs 80,000 a month. His economic rent is Rs 10,000 a
month. But his employer, the rm, does not consider only Rs 10,000 as his monthly cost on a manager.
RENT CONTROLS: AN APPLICATION OF RENT THEORY
Controlling rent on land and building, i.e., ...