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Entitlement to assort: Democracy, compromise culture and economic stability

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  • Wu, Jiabin

Abstract

We propose a simple model to support Rodrik’s (2000) conjecture that democracy lowers economic instability through breeding compromise culture. In the model, a population of compromisers and opportunists collectively bargain over the assortativity level of matching through a democratic political institution. We show that compromisers are able to achieve a positive level of assortativity which helps them to avoid matching with opportunists. This in turn raises compromisers’ payoffs above opportunists’ and eventually compromisers dominate the population through cultural evolution.

Suggested Citation

  • Wu, Jiabin, 2018. "Entitlement to assort: Democracy, compromise culture and economic stability," Economics Letters, Elsevier, vol. 163(C), pages 146-148.
    • Handle: RePEc:eee:ecolet:v:163:y:2018:i:c:p:146-148
    DOI: 10.1016/j.econlet.2017.12.023
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    References listed on IDEAS

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    1. David Cuberes & Michał Jerzmanowski, 2009. "Democracy, Diversification and Growth Reversals," Economic Journal, Royal Economic Society, vol. 119(540), pages 1270-1302, October.
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    Cited by:

    1. Jiabin Wu, 2021. "Matching markets and cultural selection," Review of Economic Design, Springer;Society for Economic Design, vol. 25(4), pages 267-288, December.
    2. Jiabin Wu, 2020. "Labelling, homophily and preference evolution," International Journal of Game Theory, Springer;Game Theory Society, vol. 49(1), pages 1-22, March.
    3. Wu, Jiabin, 2023. "Institutions, assortative matching and cultural evolution," European Journal of Political Economy, Elsevier, vol. 78(C).
    4. Kenichi Kurita & Shunsuke Managi, 2022. "COVID-19 and Stigma: Evolution of Self-restraint Behavior," Dynamic Games and Applications, Springer, vol. 12(1), pages 168-182, March.

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    More about this item

    Keywords

    Democracy; Economic stability; Assortativity; Entitlement; Evolutionary game theory;
    All these keywords.

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • Z10 - Other Special Topics - - Cultural Economics - - - General

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