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The Simple Analytics of Elite Behaviour Under Limited State Capacity

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  • François Bourguignon
  • Thierry Verdier

Abstract

This paper discusses the issue of taxation and redistribution in economies dominated by Elites with limited state capacity. Within a simple aggregate framework, we discuss the political economy incentives of Elites to tax, redistribute and increase state capacity. In particular, the analysis highlights the role of complementarities or substitutability in the production process between the factors controlled by the Elite and other social groups and shows the existence of natural increasing returns for Elites to increase state capacity.

Suggested Citation

  • François Bourguignon & Thierry Verdier, 2010. "The Simple Analytics of Elite Behaviour Under Limited State Capacity," WIDER Working Paper Series wp-2010-104, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2010-104
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    File URL: https://www.wider.unu.edu/sites/default/files/wp2010-104.pdf
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    References listed on IDEAS

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    8. Daron Acemoglu & Simon Johnson, 2005. "Unbundling Institutions," Journal of Political Economy, University of Chicago Press, vol. 113(5), pages 949-995, October.
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    Cited by:

    1. David Juárez-Luna & Christian Ghiglino, 2014. "Elite capture of democratic politics: the role of social identity," Working Papers DTE 573, CIDE, División de Economía.
    2. Arthur Silve, 2018. "Asset Complementarity, Resource Shocks, and the Political Economy of Property Rights," Journal of Conflict Resolution, Peace Science Society (International), vol. 62(7), pages 1489-1516, August.
    3. Razafindrakoto, Mireille & Roubaud, François & Rua, Linda, 2021. "Hyper-elites and network: Capturing the powerful upper tail in Madagascar," World Development, Elsevier, vol. 147(C).
    4. Mauricio Cárdenas & Marcela Eslava & Santiago Ramírez, 2013. "Do Modern-Time Wars Make States? Panel Data Evidence," Documentos CEDE 11939, Universidad de los Andes, Facultad de Economía, CEDE.
    5. repec:esx:essedp:751 is not listed on IDEAS
    6. Verdier, Thierry, 2010. "Ouverture, conflits et capacité étatique : une perspective d’économie politique," L'Actualité Economique, Société Canadienne de Science Economique, vol. 86(4), pages 415-449, décembre.
    7. David Juárez-Luna & Christian Ghiglino, 2014. "Elite capture of democratic politics: the role of social identity," Working papers DTE 573, CIDE, División de Economía.

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