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Persistence of Power, Elites, and Institutions

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Author Info
Daron Acemoglu
James A. Robinson

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Abstract

We construct a model to study the implications of changes in political institutions for economic institutions. A change in political institutions alters the distribution of de jure political power, but creates incentives for investments in de facto political power to partially or even fully offset change in de jure power. The model can imply a pattern of captured democracy, whereby a democratic regime may survive but choose economic institutions favoring an elite. The model provides conditions under which economic or policy outcomes will be invariant to changes in political institutions, and economic institutions themselves will persist over time. (JEL D02, D72)

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File URL: http://hdl.handle.net/10.1257/aer.98.1.267
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Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 98 (2008)
Issue (Month): 1 (March)
Pages: 267-93
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Handle: RePEc:aea:aecrev:v:98:y:2008:i:1:p:267-93

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Casey B. Mulligan & Kevin K. Tsui, 2006. "Political Competitiveness," NBER Working Papers 12653, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  2. David, Paul A, 1985. "Clio and the Economics of QWERTY," American Economic Review, American Economic Association, vol. 75(2), pages 332-37, May. [Downloadable!] (restricted)
  3. Roland Benabou, 2000. "Unequal Societies: Income Distribution and the Social Contract," American Economic Review, American Economic Association, vol. 90(1), pages 96-129, March. [Downloadable!] (restricted)
  4. Davide Ticchi & Andrea Vindigni, 2002. "Endogenous Constitutions," Economics Working Papers 896, Department of Economics and Business, Universitat Pompeu Fabra, revised Sep 2005. [Downloadable!]
    Other versions:
  5. Casey B. Mulligan & Ricard Gil & Xavier Sala-i-Martin, 2004. "Do Democracies Have Different Public Policies than Nondemocracies?," Journal of Economic Perspectives, American Economic Association, vol. 18(1), pages 51-74, Winter. [Downloadable!] (restricted)
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  6. Jack, William & Lagunoff, Roger, 2006. "Dynamic enfranchisement," Journal of Public Economics, Elsevier, vol. 90(4-5), pages 551-572, May. [Downloadable!] (restricted)
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  7. Matsuyama, Kiminori, 1991. "Increasing Returns, Industrialization, and Indeterminacy of Equilibrium," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 617-50, May. [Downloadable!] (restricted)
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  8. Krugman, Paul, 1991. "History versus Expectations," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 651-67, May. [Downloadable!] (restricted)
  9. Whatley, Warren C, 1985. "A History of Mechanization in the Cotton South: The Institutional Hypothesis," The Quarterly Journal of Economics, MIT Press, vol. 100(4), pages 1191-1215, November. [Downloadable!] (restricted)
  10. Milgrom, Paul & Roberts, John, 1994. "Comparing Equilibria," American Economic Review, American Economic Association, vol. 84(3), pages 441-59, June. [Downloadable!] (restricted)
  11. Dixit, Avinash K, 1989. "Entry and Exit Decisions under Uncertainty," Journal of Political Economy, University of Chicago Press, vol. 97(3), pages 620-38, June. [Downloadable!] (restricted)
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  12. Daron Acemoglu & James A. Robinson, 2001. "A Theory of Political Transitions," American Economic Review, American Economic Association, vol. 91(4), pages 938-963, September. [Downloadable!] (restricted)
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  13. Daron Acemoglu & Simon Johnson & James A. Robinson, 2001. "The Colonial Origins of Comparative Development: An Empirical Investigation," American Economic Review, American Economic Association, vol. 91(5), pages 1369-1401, December. [Downloadable!] (restricted)
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  14. Heinicke Craig, 1994. "African-American Migration and Mechanized Cotton Harvesting, 1950-1960," Explorations in Economic History, Elsevier, vol. 31(4), pages 501-520, October. [Downloadable!] (restricted)
  15. Daron Acemoglu & Simon Johnson & James A. Robinson, 2002. "Reversal Of Fortune: Geography And Institutions In The Making Of The Modern World Income Distribution," The Quarterly Journal of Economics, MIT Press, vol. 117(4), pages 1231-1294, November. [Downloadable!] (restricted)
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  16. Grossman, Gene M & Helpman, Elhanan, 1996. "Electoral Competition and Special Interest Politics," Review of Economic Studies, Blackwell Publishing, vol. 63(2), pages 265-86, April. [Downloadable!] (restricted)
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  17. Daron Acemoglu & James A. Robinson, 2000. "Why Did The West Extend The Franchise? Democracy, Inequality, And Growth In Historical Perspective," The Quarterly Journal of Economics, MIT Press, vol. 115(4), pages 1167-1199, November. [Downloadable!] (restricted)
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  18. Roger Lagunoff, 2006. "Dynamic Stability and Reform of Political Institutions," Levine's Bibliography 784828000000000051, UCLA Department of Economics. [Downloadable!]
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  19. Stephen Coate & Stephen Morris, 1999. "Policy Persistence," American Economic Review, American Economic Association, vol. 89(5), pages 1327-1336, December. [Downloadable!] (restricted)
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Casey B. Mulligan & Kevin K. Tsui, 2006. "Political Competitiveness," NBER Working Papers 12653, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  2. Ghosal, Sayantan & Proto, Eugenio, 2008. "Democracy, Collective Action and Intra-elite Conflict," The Warwick Economics Research Paper Series (TWERPS) 844, University of Warwick, Department of Economics. [Downloadable!]
    Other versions:
  3. Sukkoo Kim, 2007. "Institutions and U.S. Regional Development: A Study of Massachusetts and Virginia," NBER Working Papers 13431, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  4. Ghosal, Sayantan & Proto, Eugenio, 2007. "The Transition to Democracy : Collective Action and Intra-elite Confict," The Warwick Economics Research Paper Series (TWERPS) 807, University of Warwick, Department of Economics. [Downloadable!]
  5. Tabellini, Guido, 2007. "The Scope of Cooperation: Values and incentives," CEPR Discussion Papers 6534, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  6. Thomas Gall & Paolo Masella, 2007. "A Tale of Markets and Jungles in a Simple Model of Growth," JEPS Working Papers 07-004, JEPS. [Downloadable!]
  7. Guido Tabellini, 2007. "The Scope of Cooperation: Norms and Incentives," Levine's Working Paper Archive 321307000000000866, UCLA Department of Economics. [Downloadable!]
  8. Ticchi, Davide & Vindigni, Andrea, 2007. "War and Endogenous Democracy," Papers 03-10-2008, Princeton University, Research Program in Political Economy. [Downloadable!]
  9. Daron Acemoglu & Davide Ticchi & Andrea Vindigni, 2006. "Emergence and Persistence of Inefficient States," NBER Working Papers 12748, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  10. Guido Tabellini, . "The Scope of Cooperation: values and incentives," Working Papers 328, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University. [Downloadable!]
  11. Sarmistha Pal & Sugata Ghosh, 2006. "Elite Dominance and Under-investment in Mass Education: Disparity in the Social Development of the Indian States, 1960-92," CEDI Discussion Paper Series 06-05, Centre for Economic Development and Institutions(CEDI), Brunel University. [Downloadable!]
    Other versions:
  12. Jinhui Bai & Roger Lagunoff, 2007. "On the “Faustian” Dynamics of Policy and Political Power," Levine's Bibliography 122247000000001627, UCLA Department of Economics. [Downloadable!]
  13. Daron Acemoglu & James A. Robinson, 2006. "De Facto Political Power and Institutional Persistence," American Economic Review, American Economic Association, vol. 96(2), pages 325-330, May. [Downloadable!]
  14. Guido Tabellini, 2008. "The Scope of Cooperation: Values and Incentives," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
  15. Douhan, Robin & Henrekson, Magnus, 2007. "The Political Economy of Entrepreneurship," Working Paper Series 716, Research Institute of Industrial Economics.
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