22 votes
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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 ...
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10 votes
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What happens if the "control variables" are also endogenous?

"But if any of these control variables are endogenous to some omitted variable, doesn't this contaminate the unbiasedness of ALL the independent variables?" I don't want to emphasize this too much, ...
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  • 9,107
8 votes
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Why do all countries recognize foreign wealth?

Countries do not just stop recognizing foreign wealth because there are two kinds of wealth: real assets, and claims on the production of others; the values of both of these types of wealth are not ...
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8 votes
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Is climate change an economic question?

Climate change in itself, its measurement and the fact that it is happening, and modeling its speed or trying to discover its causes (e.g., carbon emissions, methane emissions and so on) is not an ...
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  • 41.6k
8 votes

Why land supply is inelastic?

The claim is that this curve should be a vertical line because no more land can be produced. However, as far as I understand, the supply curve represents the quantity of a product that sellers are ...
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8 votes

What are the reasons for Russian Ruble to strengthen in the past few days?

It’s likely combination of several factors. Some of it it’s because Russia has instituted capital controls (see Reuters). That means that Russians are limited or in some cases even prevented from ...
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7 votes
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Are state owned enterprises really inefficient?

Because of the large number of roughly comparably sized private and public firms, the petroleum industry provides a laboratory for exploring differences between private and state owned enterprises in ...
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7 votes

Are state owned enterprises really inefficient?

SOE's don't have to perform worse that private enterprises, but they often do. The reasons are manifold: Some SOE's are not set up for profit motive, but rather to seed strategic industries for a ...
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  • 558
6 votes

What happens if the "control variables" are also endogenous?

All is too strong, but probably some. This problem is called "smearing". Take a look at the proof in Greene's lecture notes on slide 5. Emily Oster has a nice working paper (and Stata command ...
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  • 1,105
6 votes
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Fair voting procedure when there are many issues

That's interesting: the flavor of the frequentist approach to probability used for a socio-political fairness criterion: if my measure as a population group is $0<p<1$, and known, then my ...
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5 votes
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How many major economic systems are there?

Wikipedia has a comprehensive list of economic systems. If you want to start thinking about number major economic systems that exist I recomend looking at the section on an economy's allocation ...
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  • 7,685
5 votes

Reading list: history of economic thought / political economy

My app is acting odd and won't allow me to comment, but here's my follow up comment. Yeah, for sure! My list consists of this: Wealth of Nations - Adam Smith Capital - Karl Marx Principles of ...
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  • 111
5 votes
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"Tightness" of political elections and public attention

Yes, you should look at the regression discontinuity literature in political economy that uses close elections as the identification strategy. For example, see http://sekhon.berkeley.edu/papers/...
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  • 198
5 votes

What happens if the "control variables" are also endogenous?

This is an example of what statistician Andrew Gelman calls "the fallacy of controlling for an intermediate outcome". Here is his description of this fallacy popping up when researchers ask if having ...
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5 votes

What happens if the "control variables" are also endogenous?

In the context of Least-squares estimation, the way we have to (attempt to) deal with possible endogeneity of regressors is through Instrumental Variables estimation. This approach does not depend on ...
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5 votes
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Do countries invest in the country's own stock market?

One example of monetary policy is the Bank of Japan buying the Nikkei as part of its asset purchasing program. Typically, a substantial share of citizens' wealth is connected to returns of their ...
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5 votes

Why is Mises "permitted" to define "Economics is an a priori science", if a priori is not trustworthy?

Although I disagree with von Mises, he was reacting to what he saw as a very real problem, which was the use of relatively primitive statistical methods to describe behavior. In fact, Leonard Jimmie ...
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  • 1,951
5 votes
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Is utility in neoclassical economics a circular argument/concept?

Let's be clear--the concept of utility is both unfalsifiable (as a singular proposition) and useful. Joan Robinson is right, of course: Utility as a definition is circular. If you read a textbook ...
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  • 66
4 votes

Quantitative Marxian/Marxist micro and macro economic models?

There is a very interesting paper by John Roemer, published in Econometrica in 1980, that presents a mathematical general equilibrium Marxian model. I am not sure someone have ever estimated it though....
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  • 8,437
4 votes

What does liberal economic theory say about monopolies?

Monopoly and competition are one of the central topics in microeconomics, so there many theories on the source of monopoly, and they are not universally applicable. Government intervention is ...
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  • 230
4 votes

What would happen if a country defaulted on its public debt?

A “full explanation” would be extremely long; depending on the situation, a great many things would happen. For developing countries, defaults are typically on debt in foreign currency, issued under ...
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4 votes
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Country specific economic recession/financial crisis data?

Several articles use data sets on this issue but I am not sure that all the data sets are freely available. Valencia & Laeven (2012) use the IMF country reports to create their data set. It ...
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4 votes
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What does 'Health spending as a share of GDP' mean?

Healthcare spending as a percentage of GDP is the measure of spending relative to the value of entire nations output at market prices in a given year. I suppose you can call the total output the value ...
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4 votes
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Is Keynesian economic theory still considered capitalism?

Capitalism is not well-defined in economics. In most economic textbooks the word capitalism is not even printed. However, according to dictionary (Merriam-Webster) definition: an economic system ...
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  • 41.6k
4 votes
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How did Pareto came up with Pareto Distribution of wealth law?

The Pareto distribution was derived based on the observation of Vilfredo Pareto that in Italy $80\%$ share of land belonged to $20\%$ of the country’s population, and he showed this held for many ...
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  • 41.6k
3 votes
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Educational self sufficiency

According to the OECD: Israel's spending per-student is low relative to other OECD countries. Given that countries like the US have both higher spending per-student and higher enrolment rates, it is ...
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  • 16.6k
3 votes

Reading list: history of economic thought / political economy

Personally, I feel like Joseph Schumpeter's history of economic analysis does a great job at developing the scope of how economic methodology and analysis has changed with age. It's dense and will ...
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  • 51
3 votes
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Reading list: history of economic thought / political economy

As a first read in these fields I would recommend J K Galbraith's A History of Economics. It covers, in a concise and highly readable way, major developments in economic thought from ancient times ...
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  • 6,718
3 votes
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References where fewer rules resulted in better governance

There is a movement in automotive and pedestrian traffic management called Shared Spaces. Under Shared Spaces the vast majority of formal and informal road signage is removed, such as stop signs, ...
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  • 15.9k
3 votes

References where fewer rules resulted in better governance

I think in the literature of uncertainty I once read that increasing the number of laws increases the potential source of uncertainty. However, it was probably more related to investment than to ...
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