Economic Rent

Economic rent is the income earned from a resource, land, or factor of production that exceeds what is necessary to keep it in its current use. It represents the extra payment received because of scarcity or unique advantages, rather than the effort or cost involved in producing or utilizing it. For example, if land in a prime location is rented out for above its minimum acceptable price, the extra amount is considered economic rent. It reflects the value derived from ownership or position rather than productivity, often arising from limited availability or advantageous circumstances.