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Political Economy in a Changing World

  • Daron Acemoglu
  • Georgy Egorov
  • Konstantin Sonin

We provide a general framework for the analysis of the dynamics of institutional change (e.g., democratization, extension of political rights or repression of different groups), and how these dynamics interact with (anticipated and unanticipated) changes in the distribution of political power and in economic structure. We focus on the Markov Voting Equilibria, which require that economic and political changes should take place if there exists a subset of players with the power to implement such changes and who will obtain higher expected discounted utility by doing so. Assuming that economic and political institutions as well as individual types can be ordered, and preferences and the distribution of political power satisfy natural "single crossing" (increasing differences) conditions, we prove the existence of a pure-strategy equilibrium, provide conditions for its uniqueness, and present a number of comparative static results that apply at this level of generality. We then use this framework to study the dynamics of political rights and repression in the presence of radical groups that can stochastically grab power. We characterize the conditions under which the presence of radicals leads to repression (of less radical groups), show a type of path dependence in politics resulting from radicals coming to power, and identify a novel strategic complementarity in repression.

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Paper provided by David K. Levine in its series Levine's Working Paper Archive with number 786969000000000803.

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Date of creation: 19 Sep 2013
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Handle: RePEc:cla:levarc:786969000000000803
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  1. Bruno Strulovici, 2010. "Learning While Voting: Determinants of Collective Experimentation," Econometrica, Econometric Society, vol. 78(3), pages 933-971, 05.
  2. William Jack & Roger Lagunoff, 2003. "Dynamic Enfranchisement," Wallis Working Papers WP36, University of Rochester - Wallis Institute of Political Economy.
  3. Acemoglu,Daron & Robinson,James A., 2006. "Economic Origins of Dictatorship and Democracy," Cambridge Books, Cambridge University Press, number 9780521855266.
  4. Powell, Robert, 2006. "War as a Commitment Problem," International Organization, Cambridge University Press, vol. 60(01), pages 169-203, January.
  5. Besley, Timothy & Coate, Stephen, 1998. "Sources of Inefficiency in a Representative Democracy: A Dynamic Analysis," American Economic Review, American Economic Association, vol. 88(1), pages 139-56, March.
  6. Michael C. Munger, 2001. "Voting," Chapters, in: The Elgar Companion to Public Choice, chapter 9 Edward Elgar.
  7. Barbera, S. & Maschler, M. & Shalev, J., 2001. "Voting for Voters: A Model of Electoral Evolution," Games and Economic Behavior, Elsevier, vol. 37(1), pages 40-78, October.
  8. Daron Acemoglu & Georgy Egorov & Konstantin Sonin, 2010. "Political Selection and Persistence of Bad Governments," The Quarterly Journal of Economics, Oxford University Press, vol. 125(4), pages 1511-1575.
  9. Klaus Wallner & Mike Burkart, 2000. "Club Enlargement: Early Versus Late Admittance," FMG Discussion Papers dp359, Financial Markets Group.
  10. Jack Hirshleifer & Michele Boldrin & David K Levine, 2007. "The Slippery Slope of Concession," Levine's Working Paper Archive 618897000000001057, David K. Levine.
  11. Matthias Messner & Mattias K. Polborn, 2004. "Voting on Majority Rules," Review of Economic Studies, Oxford University Press, vol. 71(1), pages 115-132.
  12. repec:oup:qjecon:v:119:y:2004:i:2:p:705-763 is not listed on IDEAS
  13. James D. Fearon, 2004. "Why Do Some Civil Wars Last So Much Longer than Others?," Journal of Peace Research, Peace Research Institute Oslo, vol. 41(3), pages 275-301, May.
  14. Etro, Federico & Ageloni, Ignazio & Alesina, Alberto, 2005. "International Unions," Scholarly Articles 4553008, Harvard University Department of Economics.
  15. repec:oup:restud:v:75:y:2008:i:4:p:987-1009 is not listed on IDEAS
  16. repec:tpr:qjecon:v:125:y:2010:i:4:p:1511-1575 is not listed on IDEAS
  17. Gregory, Paul & Schrôder, Philipp & Sonin, Konstantin, 2006. "Dictators, Repression and the Median Citizen: An “Eliminations Model” of Stalin’s Terror (Data from the NKVD Archives)," CEPR Discussion Papers 6014, C.E.P.R. Discussion Papers.
  18. Salvador Barbera & Matthew O. Jackson, 2004. "Choosing How to Choose: Self-Stable Majority Rules and Constitutions," The Quarterly Journal of Economics, Oxford University Press, vol. 119(3), pages 1011-1048.
  19. Daron Acemoglu & Georgy Egorov & Konstantin Sonin, 2009. "Political Selection and Persistence of Bad Governments," NBER Working Papers 15230, National Bureau of Economic Research, Inc.
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