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When Ideas Trump Interests: Preferences, World Views, and Policy Innovations

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  • Rodrik, Dani

Abstract

The contemporary approach to political economy is built around vested interests -- elites, lobbies, and rent-seeking groups which get their way at the expense of the general public. The role of ideas in shaping those interests is typically ignored or downplayed. Yet each of the three components of the standard optimization problem in political economy – preferences, constraints, and choice variables – rely on an implicit set of ideas. Once the manner in which ideas enter these frameworks is made explicit, a much richer and more convincing set of results can be obtained. In particular, new ideas about policy—or policy entrepreneurship—can exert an independent effect on equilibrium outcomes even in the absence of changes in the configuration of political power.

Suggested Citation

  • Rodrik, Dani, 2013. "When Ideas Trump Interests: Preferences, World Views, and Policy Innovations," CEPR Discussion Papers 9734, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:9734
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    Cited by:

    1. Philip McCann & Raquel Ortega-Argilés, 2016. "Smart specialisation, entrepreneurship and SMEs: issues and challenges for a results-oriented EU regional policy," Small Business Economics, Springer, vol. 46(4), pages 537-552, April.
    2. Pratap Bhanu Mehta & Michael Walton, 2014. "Ideas, interests and the politics of development change in India: capitalism, inclusion and the state," Global Development Institute Working Paper Series esid-036-14, GDI, The University of Manchester.
    3. Autor, David & Dorn, David & Hanson, Gordon & Majlesi, Kaveh, 2016. "Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure," Working Papers 2016:21, Lund University, Department of Economics.
    4. Fikri Zul Fahmi & Philip McCann & Sierdjan Koster, 2017. "Creative economy policy in developing countries: The case of Indonesia," Urban Studies, Urban Studies Journal Limited, vol. 54(6), pages 1367-1384, May.
    5. Frieden, Jeffry, 2015. "The political economy of adjustment and rebalancing," Journal of International Money and Finance, Elsevier, vol. 52(C), pages 4-14.
    6. David Booth & Frederick Golooba-Mutebi, 2014. "Policy for Agriculture and Horticulture in Rwanda: A Different Political Economy?," Development Policy Review, Overseas Development Institute, vol. 32(s2), pages 173-198, September.
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    8. Hefeker, Carsten & Neugart, Michael, 2018. "Non-cooperative and cooperative policy reforms under uncertainty and spillovers," Journal of Comparative Economics, Elsevier, vol. 46(1), pages 94-102.
    9. repec:bla:devpol:v:35:y:2017:i:4:p:441-453 is not listed on IDEAS
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    11. Toman Barsbai & Hillel Rapoport & Andreas Steinmayr & Christoph Trebesch, 2017. "The Effect of Labor Migration on the Diffusion of Democracy: Evidence from a Former Soviet Republic," American Economic Journal: Applied Economics, American Economic Association, vol. 9(3), pages 36-69, July.
    12. Paola Profeta & Simona Scabrosetti & Stanley Winer, 2014. "Wealth transfer taxation: an empirical investigation," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 21(4), pages 720-767, August.
    13. Giampaolo Garzarelli & Lyndal Keeton, 2016. "Policy Experimentation and Intergovernmental Grants in a Federal System," Working Papers 8/16, Sapienza University of Rome, DISS.
    14. Palley, Thomas, 2017. "A theory of economic policy lock-in and lock-out via hysteresis: Rethinking economists' approach to economic policy," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 11, pages 1-18.
    15. Majbouri, Mahdi, 2015. "Calculating the income counterfactual for oil producing countries of the MENA region," Resources Policy, Elsevier, vol. 44(C), pages 47-56.
    16. Pierpaolo Battigalli & Simone Cerreia-Vioglio & Fabio Maccheroni & Massimo Marinacci & Thomas Sargent, 2016. "A Framework for the Analysis of Self-Confi rming Policies," Working Papers 573, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    17. Chris Berg & Sinclair Davidson, 2016. "Section 18C, Human Rights, and Media Reform: An Institutional Analysis of the 2011–13 Australian Free Speech Debate Patterns in Neighboring Areas," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 23(1), pages 5-30.
    18. Yu-Fu Chen & Michael Funke, 2017. "Greece’s Three-Act Tragedy: A Simple Model of Grexit vs. Staying Afloat inside the Single Currency Area," Open Economies Review, Springer, vol. 28(2), pages 297-318, April.
    19. Shastitko. Andrey & Komkova, Anastasia Andreevna & Kurdin, Alexander & Shastitko, Anastasia, 2016. "Competition Policy and Incentives for Innovation," Working Papers 1447, Russian Presidential Academy of National Economy and Public Administration.
    20. Michael D. Bordo & Klodiana Istrefi, 2018. "Perceived FOMC: The Making of Hawks, Doves and Swingers," NBER Working Papers 24650, National Bureau of Economic Research, Inc.
    21. Faria, João Ricardo & McAdam, Peter, 2015. "Macroeconomic adjustment under regime change: From social contract to Arab Spring," Journal of International Money and Finance, Elsevier, vol. 56(C), pages 1-22.
    22. Guido Baldi, 2014. "Endogenous preference formation on macroeconomic issues: the role of individuality and social conformity," Mind & Society: Cognitive Studies in Economics and Social Sciences, Springer;Fondazione Rosselli, vol. 13(1), pages 49-58, June.
    23. Randall G. Holcombe, 2014. "What Stiglitz and Stockman Have in Common," Cato Journal, Cato Journal, Cato Institute, vol. 34(3), pages 569-579, Fall.
    24. World Bank, 2017. "Towards Privilege-Resistant Economic Policies in MENA," World Bank Other Operational Studies 27525, The World Bank.
    25. O'Reilly, Colin & Powell, Benjamin, 2015. "War and the growth of government," European Journal of Political Economy, Elsevier, vol. 40(PA), pages 31-41.

    More about this item

    Keywords

    Policy Innovations; Political Economy;

    JEL classification:

    • F5 - International Economics - - International Relations, National Security, and International Political Economy
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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