Discounting and Expropriation Risk
AbstractThis paper investigates the association between discounting and risk of expropriation and provides the theoretical conditions that make a positive association consistent with rationality. Moreover, using a national representative sample and a representative sample of the 50+ in eleven European countries, we show that discounting increases with expropriation risk. The two surveys give direct measures of discount rate as well as measures derived from households consumption decisions and provide proxies for expropriation from government and expropriation from criminal offenses.
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Bibliographic InfoPaper provided by Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy in its series CSEF Working Papers with number 179.
Date of creation: 01 May 2007
Date of revision:
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-05-26 (All new papers)
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