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Differentials in Property Rights in a two sector-economy

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Author Info

  • Caruso, Raul

    ()
    (Catholic University of the Sacred Heart)

Abstract

This paper presents a two-sector economy. In a contested sector two agents struggle to appropriate the maximum possible fraction of a contestable output. In an uncontested sector uncontested sector, they hold secure property rights over the production of some goods. Agents split their resource endowment between ‘butter’, ‘guns’ and ‘ice-cream’. The latter denote productive activities secure from appropriation. It is shown how improvements in productivity can countervail destructive impact of continuous conflicts. Eventually, the basic model is extended to consider a government and a rival group. A redistributive government can boost production in the uncontested sector, but at a higher level of ‘guns’.

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Bibliographic Info

Paper provided by Network of European Peace Scientists in its series NEPS Working Papers with number 2/2012.

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Length: 24 pages
Date of creation: 05 Sep 2012
Date of revision:
Handle: RePEc:ris:nepswp:2012_002

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Web page: http://www.europeanpeacescientists.org/
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Related research

Keywords: property rights; conflict; productive and unproductive Activities; Butter; Guns and Ice-cream; appropriation; entrepreneurship; redistribution; kleptocracy;

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References

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  1. Frederick van der Ploeg, 2008. "Voracious Transformation of a Common Natural Resource into Productive Capital," OxCarre Working Papers 002, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.
  2. James E. Anderson & Douglas Marcouiller, 2002. "Insecurity And The Pattern Of Trade: An Empirical Investigation," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 342-352, May.
  3. Matthew J. Baker, 2003. "An Equilibrium Conflict Model of Land Tenure in Hunter-Gatherer Societies," Journal of Political Economy, University of Chicago Press, vol. 111(1), pages 124-173, February.
  4. Michelle R. Garfinkel & Stergios Skaperdas, 2006. "Economics of Conflict: An Overview," Working Papers 050623, University of California-Irvine, Department of Economics, revised Sep 2006.
  5. Raul Caruso, 2007. "Continuing Conflict and Stalemate: A note," Economics Bulletin, AccessEcon, vol. 4(17), pages 1-8.
  6. Mehlum, Halvor & Moene, Karl & Torvik, Ragnar, 2003. "Predator or prey?: Parasitic enterprises in economic development," European Economic Review, Elsevier, vol. 47(2), pages 275-294, April.
  7. Anderton, Charles H & Anderton, Roxane A & Carter, John R, 1999. "Economic Activity in the Shadow of Conflict," Economic Inquiry, Western Economic Association International, vol. 37(1), pages 166-79, January.
  8. Kjell Hausken, 2006. "The Stability Of Anarchy And Breakdown Of Production," Defence and Peace Economics, Taylor & Francis Journals, vol. 17(6), pages 589-603.
  9. Raul Caruso, 2004. "A Trade Institution as a Peaceful Institution?," Others 0406003, EconWPA, revised 15 Dec 2004.
  10. Christian Riis & Derek J. Clark, 1997. "Contest success functions: an extension," Economic Theory, Springer, vol. 11(1), pages 201-204.
  11. Dixit, Avinash K, 1987. "Strategic Behavior in Contests," American Economic Review, American Economic Association, vol. 77(5), pages 891-98, December.
  12. Michelle R. Garfinkel & Stergios Skaperdas & Constantinos Syropoulos, 2006. "Globalization and Domestic Conflict," Working Papers 050601, University of California-Irvine, Department of Economics.
  13. Michelle R. Garfinkel, 2003. "On the Stability of Group Formation: Managing the Conflict Within," Public Economics 0312005, EconWPA, revised 04 Mar 2004.
  14. repec:ebl:ecbull:v:4:y:2007:i:17:p:1-8 is not listed on IDEAS
  15. Raul Caruso, 2010. "Butter, Guns And Ice-Cream Theory And Evidence From Sub-Saharan Africa," Defence and Peace Economics, Taylor & Francis Journals, vol. 21(3), pages 269-283.
  16. Baland, Jean-Marie & Francois, Patrick, 2000. "Rent-seeking and resource booms," Journal of Development Economics, Elsevier, vol. 61(2), pages 527-542, April.
  17. Torvik, Ragnar, 2002. "Natural resources, rent seeking and welfare," Journal of Development Economics, Elsevier, vol. 67(2), pages 455-470, April.
  18. Kjell Hausken, 2004. "Mutual Raiding of Production and the Emergence of Exchange," Economic Inquiry, Western Economic Association International, vol. 42(4), pages 572-586, October.
  19. Giacomo Luca & Petros Sekeris, 2012. "Land inequality and conflict intensity," Public Choice, Springer, vol. 150(1), pages 119-135, January.
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Cited by:
  1. Campiglio, Luigi Pierfranco, 2013. "Famiglia e pressione fiscale
    [Households and tax burden in Italy: 1991-2012]
    ," MPRA Paper 50592, University Library of Munich, Germany.

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