A couple weeks ago I was driving up to Pennsylvania with some friends to visit another friend of ours. On our drive up, we passed a billboard advertising a moonshine distillery- I think it was for this one. Tall Pines Distillery advertises itself as the first legal moonshine distillery in its county in Pennsylvania since the prohibition. Under Pennsylvania state law, the production of moonshine by individuals is illegal. This article explains that in 2011, state legislature changed, allowing the distilling and distribution of moonshine. In order to do this, the men who started the distillery needed a license, which they applied for and eventually received. According to one of the men, "it took more than two years to meet the regulations put in place by the state and the federal government".
This is an example of the rent seeking we've talked about in class. By opening one of a limited number of moonshine distilleries in Pennsylvania, the men who started it had an opportunity for economic profit. In order to secure this profit, they diverted resources (we don't know exactly what sort, but at least the two years spent seeking to meet state and federal regulations) in order to be eligible for a license. This rent seeking can lead to a deadweight loss, and likely did in this case because of the time and resources spent in order to meet regulations, and also because there may have been others who diverted their time and resources towards gaining a license who did not get one. Now the owners of Tall Pines Distillery are reaping the benefit in the form of economic rent, though there may have been others who missed out because they were unable to get a license.
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