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When elders rule: is gerontocracy harmful for growth?

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  • Atella, Vincenzo
  • Carbonari, Lorenzo

Abstract

We study the relationship between gerontocracy and aggregate economic perfomance in a simple model where growth is driven by human capital accumulation and productive government spending. We show that gerontocratic élites display the tendency to underinvest in public education and productive government services and thereby may be harmful growth. In absence of intergenerational altruism, the damage caused by gerontocracy is mainly due to the lack in long-term delayed-return investment originated by the shorter life horizon of the ruling class with respect to the rest of the population. An empirical analysis is carried out on a rich data set that al lows to test theoretical results across different countries and different sectors. The econometric results confirm our main hypotheses.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 36574.

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Date of creation: 12 Jan 2012
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Handle: RePEc:pra:mprapa:36574

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Keywords: Gerontocracy; Economic Growth and Aggregate Productivity;

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