IDEAS home Printed from https://ideas.repec.org/a/jid/journl/y2012v21i3-4p3-24.html
   My bibliography  Save this article

A Model for Anocracy

Author

Listed:
  • Aleksandr Hrachik Grigoryan

    (American University of Armenia)

Abstract

In this article a dynasty model is developed with a non-benevolent planner who maximizes the welfare of a size-adjusted elite. Joining the elite is costly, as it provides access to financial intermediation for new entrants. Some of the incumbents collect payments, which are redistributed back based on their welfare status. Corrupt incumbents necessarily emerge and amplify negative externality towards the poor through collateral, which is required for loan market participation. The resulting model is useful to describe the evolution of incomplete democracies (anocracies). Elites alternate with each other, and successors discipline their predecessors with expropriation threats on collected rents should too many licenses for intermediation be sold, as that accelerates the wealth equalization process. This disciplinary mechanism, however, mitigates wealth differences, since it creates a burden on corruption, and the elite is expanded through intermediaries.

Suggested Citation

  • Aleksandr Hrachik Grigoryan, 2013. "A Model for Anocracy," Journal of Income Distribution, Ad libros publications inc., vol. 22(1), pages 3-24, November.
  • Handle: RePEc:jid:journl:y:2012:v:21:i:3-4:p:3-24
    as

    Download full text from publisher

    File URL: http://pi.library.yorku.ca/ojs/index.php/jid/article/view/32133
    Download Restriction: Some fulltext downloads are only available to subscribers. See JID website for details.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Non-benevolent planner; elite; financial intermediaries; wealth inequality; corruption;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:jid:journl:y:2012:v:21:i:3-4:p:3-24. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Timm Boenke (email available below). General contact details of provider: https://edirc.repec.org/data/gyorkca.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.