Quasi-rent

Quasi-rent or Marshallian rent is a temporary economic rent like returns to a supplier/owner. Alfred Marshall was the first to observe quasi-rents. Quasi-rent or Marshallian rent is a temporary economic rent like returns to a supplier/owner. Alfred Marshall was the first to observe quasi-rents. Quasi-rent differs from pure economic rent in that it is a temporary phenomenon. It can arise from the barriers to entry that potential competitors face in the short run, such as the granting of patents or other legal protections for intellectual property by governments. It can also arise due to entrepreneurial address of market fluctuation, or it can arise due to the lack of real capital to meet near term demand increases. In the longer term the opportunity to profit will bring new capital into existence and the quasi rent will be competed away. In Industrial Organizations field, Williamson points 'The joining of opportunism with transaction-specific investments (or what Klein, Crawford, and Alchian refer to as 'appropriable quasi rents') is a leading factor in explaining decisions to vertically integrate.'