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On the Joint Evolution of Culture and Institutions

Author

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  • Alberto Bisin

    () (New York University)

  • Thierry Verdier

    () (Paris School of Economics)

Abstract

Explanations of economic growth and prosperity commonly identify a unique causal effect, e.g., institutions, culture, human capital, geography. In this paper we provide instead a theoretical modeling of the interaction between culture and institutions and their effects on economic activity. We characterize conditions on the socio-economic environment such that culture and institutions complement (resp. substitute) each other, giving rise to a multiplier effect which amplifies (resp. dampens) their combined ability to spur economic activity. We show how the joint dynamics of culture and institutions may display interesting non-ergodic behavior, hysteresis, oscillations, and comparative dynamics. Finally, in specific example societies, we study how culture and institutions interact to determine the sustainability of extractive societies as well as the formation of civic capital and of legal systems protecting property rights.

Suggested Citation

  • Alberto Bisin & Thierry Verdier, 2017. "On the Joint Evolution of Culture and Institutions," Working Papers 2017-039, Human Capital and Economic Opportunity Working Group.
  • Handle: RePEc:hka:wpaper:2017-039
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    Cited by:

    1. Roland, Gerard, 2020. "The deep historical roots of modern culture: A comparative perspective," Journal of Comparative Economics, Elsevier, vol. 48(3), pages 483-508.
    2. Timothy Besley, 2020. "State Capacity, Reciprocity, and the Social Contract," Econometrica, Econometric Society, vol. 88(4), pages 1307-1335, July.
    3. Melindi-Ghidi, Paolo & Dedeurwaerdere, Tom & Fabbri, Giorgio, 2020. "Using environmental knowledge brokers to promote deep green agri-environment measures," Ecological Economics, Elsevier, vol. 176(C).
    4. Chaudhary, Latika & Rubin, Jared & Iyer, Sriya & Shrivastava, Anand, 2020. "Culture and colonial legacy: Evidence from public goods games," Journal of Economic Behavior & Organization, Elsevier, vol. 173(C), pages 107-129.
    5. Emanuela Migliaccio & Thierry Verdier, 2018. "On the Spatial Diffusion of Cooperation with Endogenous Matching Institutions," Games, MDPI, Open Access Journal, vol. 9(3), pages 1-1, August.
    6. Zhang, Zhe & Zhang, Xu & Putterman, Louis, 2019. "Trust and cooperation at a confluence of worlds: An experiment in Xinjiang, China," Journal of Economic Behavior & Organization, Elsevier, vol. 161(C), pages 128-144.
    7. Giampaolo Lecce & Laura Ogliari & Tommaso Orlando, 2017. "Resistance to Institutions and Cultural Distance: Brigandage in Post-Unification Italy," Cowles Foundation Discussion Papers 2097, Cowles Foundation for Research in Economics, Yale University.
    8. Mausumi Das & Priyanka Arora, 2020. "Culture and Market: A Macroeconomic Tale of Two Institutions," Working papers 307, Centre for Development Economics, Delhi School of Economics.
    9. Øivind Schøyen, 0. "What limits the efficacy of coercion?," Cliometrica, Springer;Cliometric Society (Association Francaise de Cliométrie), vol. 0, pages 1-52.
    10. Brodeur, Abel & Mabeu, Marie Christelle & Pongou, Roland, 2020. "Ancestral Norms, Legal Origins, and Female Empowerment," IZA Discussion Papers 13105, Institute of Labor Economics (IZA).
    11. Alberto Bisin, 2020. "A Comment on: “State Capacity, Reciprocity, and the Social Contract” by Timothy Besley," Econometrica, Econometric Society, vol. 88(4), pages 1345-1349, July.
    12. Ahn, T.K. & Loukas, Balafoutas & Batsaikhan, Mongoljin & Campos-Ortiz, Francisco & Putterman, Louis & Sutter, Matthias, 2018. "Trust and communication in a property rights dilemma," Journal of Economic Behavior & Organization, Elsevier, vol. 149(C), pages 413-433.
    13. Timothy Besley, 2020. "Reply to: Comments on “State Capacity, Reciprocity, and the Social Contract”," Econometrica, Econometric Society, vol. 88(4), pages 1359-1362, July.
    14. Albanese, Giuseppe & Cioffi, Marika & Tommasino, Pietro, 2019. "Legislators' behaviour and electoral rules: Evidence from an Italian reform," European Journal of Political Economy, Elsevier, vol. 59(C), pages 423-444.
    15. Zhang, Chuanchuan, 2020. "Clans, entrepreneurship, and development of the private sector in China," Journal of Comparative Economics, Elsevier, vol. 48(1), pages 100-123.
    16. Duc Anh Dang & Kim Khoi Dang & Thi Lan Vu, 2018. "How does joint evolution of social trust and land administration shape economic outcomes?: Evidence from Vietnam," WIDER Working Paper Series wp-2018-98, World Institute for Development Economic Research (UNU-WIDER).
    17. Zhou, Haiwen, 2020. "Culture, institutions, and long-run performance," MPRA Paper 103900, University Library of Munich, Germany.
    18. repec:bla:annpce:v:89:y:2018:i:1:p:251-258 is not listed on IDEAS
    19. Dang, Duc Anh & Dang, Kim Khoi & Dang, Vuong Anh & Vu, Thi Lan, 2020. "The effects of trust and land administration on economic outcomes: Evidence from Vietnam," Food Policy, Elsevier, vol. 94(C).
    20. Carillo, Mario Francesco, 2018. "Fascistville: Mussolini's New Towns and the Persistence of Neo-Fascism," MPRA Paper 96236, University Library of Munich, Germany, revised 03 Oct 2019.

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    More about this item

    Keywords

    cultural transmission; evolution of institutions;

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
    • P48 - Economic Systems - - Other Economic Systems - - - Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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