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22 votes
Accepted

Are democracies more economically productive than autocracies?

In economics, it is accepted that countries with good 'inclusive' institutions, such as strong property rights, are more productive and able to develop faster (or even develop at all) than countries ...
1muflon1's user avatar
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4 votes
Accepted

Net product marginal in Acemoglu's article "Modeling inefficient institutions"

Calculate the first-order-condition (FOC) wrt labour: $$\begin{align}\frac{\partial}{\partial l_t^j} \left( \frac{1 - \tau_t^j}{1 - \alpha} (A^j)^\alpha (k_t^j)^{1-\alpha} (l_t^j)^\alpha - w_t l_t^j - ...
uninterestedacademic's user avatar
4 votes

How would you explain systemic flaws of communism?

What flaws do you see in my argumentation? There are several flaws in your thesis. First, I know USSR and eastern block are commonly labeled 'communist countries', but they were not communist ...
1muflon1's user avatar
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3 votes

How would you explain systemic flaws of communism?

What flaws do you see in my argumentation? How would you explain it? There are no flaws in your argumentation in regard to that debate. Your explanation mostly summarizes the concept of utility in a ...
Iñaki Viggers's user avatar
3 votes

Did Elinor Ostrom (or others) resolve the tragedy of the commons for common-pool resources?

Depends on your definition of 'resolve'. In economic there were already proposed solutions for both public good and common-pool resources. However, most of those require some sort of government ...
1muflon1's user avatar
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3 votes
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How long into the past can we trace the effect of institutions?

Institutions are likely having a permanent effects as they create path dependency which implies that even temporary shocks would have permanent effect. At least that is what is argued by many ...
1muflon1's user avatar
  • 56.4k
3 votes

Contract theory: Incentive contracts (when agents have multiple tasks) models by G. Baker and Holmstrom & Milgrom

Holmström and Milgrom assume that the agent exhibits constant absolute risk aversion. This implies that if you change the total wage of the agent with a lump sum transfer (that does not depend on ...
brunosalcedo's user avatar
3 votes

Literature recommendation on organised crime

I would suggest looking at some of the research by Francis Fukuyama. "Social Capital, Civil Society, and Development," Third World Quarterly 22 (no. 1, 2001). or https://fukuyama.stanford....
Arash Howaida's user avatar
3 votes
Accepted

Will economic discrepancy between democratic and authoritarian states decrease over time?

As you point out, going by the typical doctrine of extractive institutions from Why Nations Fail (Acemoglu), we have this basic framework: Disenfranchisement of private sector leads to capital flight ...
Arash Howaida's user avatar
2 votes

How would you explain systemic flaws of communism?

The easiest way to understand why socialist and communist economies trend toward failure is explained by F.A. Hayek in his article The Use of Knowledge in Society. To sum it up: there are limits on ...
JD Montgomery's user avatar
1 vote

How would you explain systemic flaws of communism?

All economic problems have two fundamental variables: price and quantity. These variables can possibly be declined in space and time. Depending on the type of control that economic agents exercise ...
marco tognoli's user avatar
1 vote

A few questions in paper Chong 2007

Could you help me derive Eq(5) in paper Chong (2007)? My initial derivations were wrong because I misread Eq(1) as $y_{i,t}=c_{i,t}+r_{i,t}$. It was until I read the answer posted by @...
Iñaki Viggers's user avatar
1 vote

Are businesses included in economic institutions?

Unfortunately, economists don't have a standard, universally-accepted definition of what an 'institution' is. Hence, depending on what you're trying to study and whom you ask, businesses may or may ...
Theoretical Economist's user avatar

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