I don't support rent seeking, even when my government does it. Our retirement accounts would be bigger (by a factor of 2~3x) if we* allowed for the free movement of labour.
EDITed to add: * - we in this context means every government on the face of the planet
Yes, overall economy would be bigger.
Since you/I/other-successful-professionals-we-know-in-the-coasts have better than even odds of thriving in any such efficient economic growth, it would even be in our selfish interest to have such a no-rent-seeking-allowed economic policy worldwide. Our 401k accounts will be bigger. Our professional salaries might adjust a bit downward (US professional salaries are higher in general), but the purchasing power will likely only increase.
But efficient (and bigger) economics often has brutal ways to pick out the losers. If you read the Washington Post article I linked, you would see it talks about a couple of people who have been handed pretty slim odds as low skill workers. Their living standards are kept artificially high by the said rent seeking done by the US government.
In any "no rent seeking allowed" scenario, they (and their communities) will likely not be able to compete with an impoverished low-skill worker from India/China.
Can any democracy allow that? Should it?
My opinion is no, on both counts!
Long term or short term? Carl Benedikt Frey makes a pretty good argument in The Technology Trap: Capital, Labor, and Power in the Age of Automation that the welfare state encourages innovation. Who wants to try anything new if they odds or failure are 3:4 and failure means starving to death? But we might be getting off track.
I haven't read that book. Need to grab it.
Thx.