A few hundred U.S. sugar makers lobby the U.S. government each year to make sure that the government taxes imported sugar at a high rate. They do so because the policy drives up the domestic price of sugar and increases their profits. It is estimated that the policy benefits U.S. sugar producers by about $1 billion per year while costing U.S. consumers upwards of $2 billion per year. Which of the following concepts apply to the U.S. sugar tax?
Select all that apply
1. Political corruption.
2. Rent-seeking behavior.
3. The collective-action problem.
4 The special-interest effect.
