Download or read book Institutional Trap written by Quy-Toan Do and published by World Bank Publications. This book was released on 2004 with total page 35 pages. Available in PDF, EPUB and Kindle. Book excerpt: Abstract: The author studies the persistence of inequality and inefficient governance in a physical capital accumulation model with perfect information, missing credit markets, and endogenous barriers to entry. When access to investment opportunities is regulated, rent-seeking entrepreneurs form coalitions of potentially varying size to bribe a regulator to restrict entry. Small coalitions run short of resources, while large coalitions suffer more severe free-rider problems. The distribution of wealth thus determines the equilibrium coalition structure of the economy and consequently the level of regulatory capture. A dynamic analysis supports the persistence of inefficiencies in the long run. Initial conditions determine whether the economy converges to a steady state characterized by efficient governance and low levels of inequality, or a path toward an institutional trap where regulatory capture and wealth inequality reinforce each other. This paper"a product of the Poverty Team, Development Research Group"is part of a larger effort in the group to understand the determinants of institutions.
Download or read book Institutional Trap written by Victor Polterovich and published by . This book was released on 2011 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: One of the main obstacles for successful economic development is the formation of institutional traps, inefficient yet stable norms of behaviour. Domination of barter exchange, arrears, corruption and black market activities are examples of institutional traps that have hampered reforms in transition economies. Institutional traps are supported by mechanisms of coordination, learning, linkage and cultural inertia. The acceleration of economic growth, systemic crisis, the evolution of some cultural characteristics and the development of civil society may result in breaking out of institutional traps. Examples from the history of the United States and Russia are considered.
Download or read book A Middle Quality Institutional Trap Democracy and State Capacity in Latin America written by Sebastián L. Mazzuca and published by Cambridge University Press. This book was released on 2021-02-11 with total page 112 pages. Available in PDF, EPUB and Kindle. Book excerpt: Latin America is currently caught in a middle-quality institutional trap, combining flawed democracies and low-to-medium capacity States. Yet, contrary to conventional wisdom, the sequence of development - Latin America has democratized before building capable States - does not explain the region's quandary. States can make democracy, but so too can democracy make States. Thus, the starting point of political developments is less important than whether the State-democracy relationship is a virtuous cycle, triggering causal mechanisms that reinforce each other. However, the State-democracy interaction generates a virtuous cycle only under certain macroconditions. In Latin America, the State-democracy interaction has not generated a virtuous cycle: problems regarding the State prevent full democratization and problems of democracy prevent the development of state capacity. Moreover, multiple macroconditions provide a foundation for this distinctive pattern of State-democracy interaction. The suboptimal political equilibrium in contemporary Latin America is a robust one.
Download or read book Institutional Trap written by Quy-Toan Do and published by . This book was released on 2013 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The author studies the persistence of inequality and inefficient governance in a physical capital accumulation model with perfect information, missing credit markets, and endogenous barriers to entry. When access to investment opportunities is regulated, rent-seeking entrepreneurs form coalitions of potentially varying size to bribe a regulator to restrict entry. Small coalitions run short of resources, while large coalitions suffer more severe free-rider problems. The distribution of wealth thus determines the equilibrium coalition structure of the economy and consequently the level of regulatory capture. A dynamic analysis supports the persistence of inefficiencies in the long run. Initial conditions determine whether the economy converges to a steady state characterized by efficient governance and low levels of inequality, or a path toward an institutional trap where regulatory capture and wealth inequality reinforce each other.
Download or read book Trapped in the Middle written by José Antonio Alonso and published by Oxford University Press, USA. This book was released on 2020-10-22 with total page 369 pages. Available in PDF, EPUB and Kindle. Book excerpt: Trapped in the Middle? investigates whether middle-income traps really exist and, in case they do, how these pitfalls are manifested, their causes, what economic policy measures are required to escape from them, and what international cooperation can do to support this process.
Download or read book How China Escaped the Poverty Trap written by Yuen Yuen Ang and published by Cornell University Press. This book was released on 2016-09-06 with total page 345 pages. Available in PDF, EPUB and Kindle. Book excerpt: WINNER OF THE 2017 PETER KATZENSTEIN BOOK PRIZE "BEST OF BOOKS IN 2017" BY FOREIGN AFFAIRS WINNER OF THE 2018 VIVIAN ZELIZER PRIZE BEST BOOK AWARD IN ECONOMIC SOCIOLOGY "How China Escaped the Poverty Trap truly offers game-changing ideas for the analysis and implementation of socio-economic development and should have a major impact across many social sciences." ― Zelizer Best Book in Economic Sociology Prize Committee Acclaimed as "game changing" and "field shifting," How China Escaped the Poverty Trap advances a new paradigm in the political economy of development and sheds new light on China's rise. How can poor and weak societies escape poverty traps? Political economists have traditionally offered three answers: "stimulate growth first," "build good institutions first," or "some fortunate nations inherited good institutions that led to growth." Yuen Yuen Ang rejects all three schools of thought and their underlying assumptions: linear causation, a mechanistic worldview, and historical determinism. Instead, she launches a new paradigm grounded in complex adaptive systems, which embraces the reality of interdependence and humanity's capacity to innovate. Combining this original lens with more than 400 interviews with Chinese bureaucrats and entrepreneurs, Ang systematically reenacts the complex process that turned China from a communist backwater into a global juggernaut in just 35 years. Contrary to popular misconceptions, she shows that what drove China's great transformation was not centralized authoritarian control, but "directed improvisation"—top-down directions from Beijing paired with bottom-up improvisation among local officials. Her analysis reveals two broad lessons on development. First, transformative change requires an adaptive governing system that empowers ground-level actors to create new solutions for evolving problems. Second, the first step out of the poverty trap is to "use what you have"—harnessing existing resources to kick-start new markets, even if that means defying first-world norms. Bold and meticulously researched, How China Escaped the Poverty Trap opens up a whole new avenue of thinking for scholars, practitioners, and anyone seeking to build adaptive systems.
Download or read book Poverty Traps written by Samuel Bowles and published by Princeton University Press. This book was released on 2016-05-31 with total page 251 pages. Available in PDF, EPUB and Kindle. Book excerpt: Much popular belief--and public policy--rests on the idea that those born into poverty have it in their power to escape. But the persistence of poverty and ever-growing economic inequality around the world have led many economists to seriously question the model of individual economic self-determination when it comes to the poor. In Poverty Traps, Samuel Bowles, Steven Durlauf, Karla Hoff, and the book's other contributors argue that there are many conditions that may trap individuals, groups, and whole economies in intractable poverty. For the first time the editors have brought together the perspectives of economics, economic history, and sociology to assess what we know--and don't know--about such traps. Among the sources of the poverty of nations, the authors assign a primary role to social and political institutions, ranging from corruption to seemingly benign social customs such as kin systems. Many of the institutions that keep nations poor have deep roots in colonial history and persist long after their initial causes are gone. Neighborhood effects--influences such as networks, role models, and aspirations--can create hard-to-escape pockets of poverty even in rich countries. Similar individuals in dissimilar socioeconomic environments develop different preferences and beliefs that can transmit poverty or affluence from generation to generation. The book presents evidence of harmful neighborhood effects and discusses policies to overcome them, with attention to the uncertainty that exists in evaluating such policies.
Download or read book Social Traps and the Problem of Trust written by Bo Rothstein and published by Cambridge University Press. This book was released on 2005-10-06 with total page 264 pages. Available in PDF, EPUB and Kindle. Book excerpt: A 'social trap' is a situation where individuals, groups or organisations are unable to cooperate owing to mutual distrust and lack of social capital, even where cooperation would benefit all. Examples include civil strife, pervasive corruption, ethnic discrimination, depletion of natural resources and misuse of social insurance systems. Much has been written attempting to explain the problem, but rather less material is available on how to escape it. In this book, Bo Rothstein explores how social capital and social trust are generated and what governments can do about it. He argues that it is the existence of universal and impartial political institutions together with public policies which enhance social and economic equality that creates social capital. By introducing the theory of collective memory into the discussion, Rothstein makes an empirical and theoretical claim for how universal institutions can be established.
Download or read book Institutional Trap written by Quý Toàn Đõ̂ and published by . This book was released on 2004 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: The author studies the persistence of inequality and inefficient governance in a physical capital accumulation model with perfect information, missing credit markets, and endogenous barriers to entry. When access to investment opportunities is regulated, rent-seeking entrepreneurs form coalitions of potentially varying size to bribe a regulator to restrict entry. Small coalitions run short of resources, while large coalitions suffer more severe free-rider problems. The distribution of wealth thus determines the equilibrium coalition structure of the economy and consequently the level of regulatory capture. A dynamic analysis supports the persistence of inefficiencies in the long run. Initial conditions determine whether the economy converges to a steady state characterized by efficient governance and low levels of inequality, or a path toward an institutional trap where regulatory capture and wealth inequality reinforce each other.
Download or read book Institutional Traps and Transition written by Victor Polterovich and published by . This book was released on 2011 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Two myths have harmed many economies throughout the world. One is the theory of absolute advantage of central planning over the market mechanism, and the other is the belief that efficient markets develop spontaneously and quickly enough if appropriate economic legislation is established. Volumes have been written to debunk the first myth. The falsity of the second needs to be better understood. The problem is that inside of any legislated change there exists a room for development of different institutions, or behavior norms, and it is not simple to predict which direction will be chosen by an economy. The hypothesis that efficient institutions must arise because of natural selection does not prove to be truthful. Inefficient development can be self-supporting and stable. The supporting mechanisms were systematically investigated by Arthur (1988) for technological changes. North (1990) pointed out that the same mechanisms plaid an important role in the evolution of institutions. A number of examples have been studied in different branches of economics. The most striking examples can be found in recent history of economic reforms in Russia and East European countries. This chapter uses the ideas by Arthur and North to describe a general scheme for the formation of inefficient yet stable norm or institutions, referred herein as institutional traps. The scheme is substantially based on the concepts of transaction costs, transformation costs, and transitional rent discussed below. Then the theory developed is applied to explain emergence in Russia of barter, mutual arrears, tax evasion, corruption, and some other institutional traps. Implications for reform strategy are explored. The analysis shows that the formation of institutional traps is a major risk in any reform process, and avoidance of these traps is an urgent task during transition.
Download or read book The Economics of Poverty Traps written by Christopher B. Barrett and published by University of Chicago Press. This book was released on 2018-12-07 with total page 425 pages. Available in PDF, EPUB and Kindle. Book excerpt: What circumstances or behaviors turn poverty into a cycle that perpetuates across generations? The answer to this question carries especially important implications for the design and evaluation of policies and projects intended to reduce poverty. Yet a major challenge analysts and policymakers face in understanding poverty traps is the sheer number of mechanisms—not just financial, but also environmental, physical, and psychological—that may contribute to the persistence of poverty all over the world. The research in this volume explores the hypothesis that poverty is self-reinforcing because the equilibrium behaviors of the poor perpetuate low standards of living. Contributions explore the dynamic, complex processes by which households accumulate assets and increase their productivity and earnings potential, as well as the conditions under which some individuals, groups, and economies struggle to escape poverty. Investigating the full range of phenomena that combine to generate poverty traps—gleaned from behavioral, health, and resource economics as well as the sociology, psychology, and environmental literatures—chapters in this volume also present new evidence that highlights both the insights and the limits of a poverty trap lens. The framework introduced in this volume provides a robust platform for studying well-being dynamics in developing economies.
Download or read book Asia and the Middle Income Trap written by Francis E. Hutchinson and published by Routledge. This book was released on 2016-07-01 with total page 265 pages. Available in PDF, EPUB and Kindle. Book excerpt: The term ‘Middle-Income Trap’ refers to countries which stagnate economically after reaching a certain level of per capita income on the basis of labour- and capital-intensive growth, and are struggling to transition towards more skill-intensive and technology-driven development. It has resonance for the increasing number of countries in Asia who have either languished in middle-income status for extended periods of time, or are worried about growth slow-downs. This book sets outs the conceptual underpinnings of the Middle-Income Trap and explores the various ways it can be defined. It also focuses on the debate surrounding the Middle-Income Trap which questions the appropriate institutional and policy settings for middle-income countries to enable them to continue past the easy phase of economic growth. The book engages with this debate by investigating the role of institutions, human capital, and trade policy in helping countries increase their income levels and by highlighting factors which enable the shift to higher and qualitatively better growth. It questions how the large emerging economies in Asia such as China, Indonesia, and India are currently grappling with the challenges of transitioning from labour-intensive to technology- and knowledge-intensive production, and discusses what can be learnt from the countries that have been able to escape the trap to attain high-income status. Providing a conceptual framework for the Middle-Income Trap, this book will be of interest to students and scholars of Asian Economics, Comparative Economics and Asian Studies.
Download or read book The Meritocracy Trap written by Daniel Markovits and published by Penguin. This book was released on 2020-09-08 with total page 450 pages. Available in PDF, EPUB and Kindle. Book excerpt: A revolutionary new argument from eminent Yale Law professor Daniel Markovits attacking the false promise of meritocracy It is an axiom of American life that advantage should be earned through ability and effort. Even as the country divides itself at every turn, the meritocratic ideal – that social and economic rewards should follow achievement rather than breeding – reigns supreme. Both Democrats and Republicans insistently repeat meritocratic notions. Meritocracy cuts to the heart of who we are. It sustains the American dream. But what if, both up and down the social ladder, meritocracy is a sham? Today, meritocracy has become exactly what it was conceived to resist: a mechanism for the concentration and dynastic transmission of wealth and privilege across generations. Upward mobility has become a fantasy, and the embattled middle classes are now more likely to sink into the working poor than to rise into the professional elite. At the same time, meritocracy now ensnares even those who manage to claw their way to the top, requiring rich adults to work with crushing intensity, exploiting their expensive educations in order to extract a return. All this is not the result of deviations or retreats from meritocracy but rather stems directly from meritocracy’s successes. This is the radical argument that Daniel Markovits prosecutes with rare force. Markovits is well placed to expose the sham of meritocracy. Having spent his life at elite universities, he knows from the inside the corrosive system we are trapped within. Markovits also knows that, if we understand that meritocratic inequality produces near-universal harm, we can cure it. When The Meritocracy Trap reveals the inner workings of the meritocratic machine, it also illuminates the first steps outward, towards a new world that might once again afford dignity and prosperity to the American people.
Download or read book Institutional Traps and Economic Growth written by Mark Gradstein and published by . This book was released on 2007 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Japan s Policy Trap written by Akio Mikuni and published by Rowman & Littlefield. This book was released on 2004-05-13 with total page 314 pages. Available in PDF, EPUB and Kindle. Book excerpt: Until quite recently, the Japanese inspired a kind of puzzled awe. They had pulled themselves together from the ruin of war, built at breakneck speed a formidable array of export champions, and emerged as the world's number-two economy and largest net creditor nation. And they did it by flouting every rule of economic orthodoxy. But today only the puzzlement remains—at Japan's inability to arrest its economic decline, at its festering banking crisis, and at the dithering of its policymakers. Why can't the Japanese government find the political will to fix the country's problems? Japan's Policy Trap offers a provocative new analysis of the country's protracted economic stagnation. Japanese insider Akio Mikuni and long-term Japan resident R. Taggart Murphy contend that the country has landed in a policy trap that defies easy solution. The authors, who have together spent decades at the heart of Japanese finance, expose the deep-rooted political arrangements that have distorted Japan's monetary policy in a deflationary direction. They link Japan's economic difficulties to the Achilles' heel of the U.S. economy: the U.S. trade and current accounts deficits. For the last twenty years, Japan's dollar-denominated trade surplus has outstripped official reserves and currency in circulation. These huge accumulated surpluses have long exercised a growing and perverse influence on monetary policy, forcing Japan's authorities to support a build-up of deflationary dollars. Mikuni and Murphy trace the origins of Japan's policy trap far back into history, in the measures taken by Japan's officials to preserve their economic independence in what they saw as a hostile world. Mobilizing every resource to accumulate precious dollars, the authorities eventually found themselves coping with a hoard they could neither use nor exchange. To counteract the deflationary impact, Japanese authorities resorted to the creation of yen liabilities unrelated to production via the large
Download or read book Institutional Inertia written by Ms.Laura Valderrama and published by International Monetary Fund. This book was released on 2009-09-01 with total page 27 pages. Available in PDF, EPUB and Kindle. Book excerpt: We study the relative efficiency of outside-owned versus employee-owned firms and analyze implications for institutional change in a context of technological innovation. When decisions are made through majority voting, the vote on technology choice is used to influence the later vote on the sharing rule. We show how this dynamic voting generates a systematic technological bias that is contingent on firm ownership. We provide conditions under which the pivotal voter's political leverage leads the firm to an institutional trap whereby majority voting and inefficient technology choice reinforce each other, leading to institutional inertia.
Download or read book Trap nesting Wasps and Bees Life Histories Nests and Associates written by Karl V. Krombein and published by . This book was released on 1967 with total page 592 pages. Available in PDF, EPUB and Kindle. Book excerpt:
