经济增长的制度环境课件.doc

经济增长的制度环境课件 1Political institutionsand economic growth Ling Shen Schoolof Economics,SHUFE2?沈凌田国强xx“经济增长的制度环境”工作论文?Marc Schiffbauer&Ling Shenxx“Democracy vs.Dictatorship:paring theevolution of economic growthunder twopolitical regimes”the Economicsof Transition?Ling Shenxx“When willa dictatorbe good?”Economic Theory31 (2),pp.343-3663From R.Barro“Macroeconomics”xx4Economic growthin dictatorship?Most developingcountries havedictatorial politicalinstitution.Sample?157?GDP percapitaUSDAverage growth rate%p.a.Civil LibertyIndex1972-741970xxDeveloping11330023704.784.56Developed442446285506.662.81?Civil LibertyIndex:from Freedomhouse1.0-7.0political environmentof economicdevelopment.5Discussion in a politicaleconomy model:Do we“need”democracy?.6Some facts:?Democracy hashigher growth rate onaverage?and quitestable-less hopeto catchup?Dictatorship is a riskyproject C.L.Sample157Civil LibertyIndex1972-74Average growth rate%p.a.Variance ofgrowth rate76426.384.378.035.95275.224.466.284.94184.284.445.493.93233.266.004.322.92282.086.075.511.91191.027.460.89Ave4.075.846.627Dictatorial countries:Index ofcivil liberties(1.0-7.0)bigger than6.0in1972/74.All datafrom UNand Barro-Lee1994.real GDPp.c.of somedictatorial countries1970-2000020004000600080001000012000140001970197219741976197819801982198419861988199019921994199619982000Congo(democratic rep.)Gabon Guinea-BissauMali MozambiqueUgandaChina Korea(South)Oman8?Discussion in a politicaleconomy model1Do we“need”a dictator?2When willa dictatorbe“good”?3When willdemocratization happen?.9The basicidea?Barro (1996):“Democracy andgrowth”,Journal ofeconomic growth (1),pp.1-27?Tarares andWacziarg (xx):“How democracyaffects growth”,European EconomicReview (45),pp.1341-1378?Democracy:Advantage:more humancapital investment,less inequalityDisadvantage:less physicalcapital investment?Dictatorship:Advantage:more infrastructure(physical)investment Disadvantage:more corruption10The basicidea?A positivebequest motivein theform of private andpublic investments.?A subsistencelevel ofconsumption:individuals willaumulate capitalonly if they arerich enough.?The trade-off of a dictator:she can expropriate citizens,hence,she isrich enoughto induce a positivecapital aumulation.On theother hand,the expropriationis acost forcitizens,hence,citizens“need not”her whenthey arerich enough.11A simpleversion of the model1.Utility function:2.Production function:?t tt tNAk YAky?0,10,)ln()1(ln?g pib CU ii123.Capital evolutionfunctions:4.Political institutions:dictatorship:the singleruler decides the tax rate andinvestment democracy:simple majorityrulethe median voter gtpt tt tbb bkb kk?001013?The optimalityproblem indemocracy?b c y t sb cUb?.ln1ln max?1110011y ifyy ifbbb ydbdUProposition1?If thereis nogovernment,or governmentis democratic,the economycould have a zerogrowth rateina“poverty trap”-under certainconditions.14?The optimalityproblem in dictatorship?For individuals:?N bb bbc yt sbc Ugpp pppbp/1.ln1ln max?)1)(1()/()/()1 (1)1)(1()/(0?N byif Nb yNby ifbgggp?Proposition2?If thereisaselfish dictator,the incentiveofprivate investment decreases.15?g pggg gbbNb bbc Nytsbc Ug?.ln1ln max?NNby ifNb NyNNbyifbpppg?)1()() (1)1()(0For dictator?16?Proposition3?Under certainconditions,even aselfish dictatorwould leadthe economyto leavethe“poverty trap”,i.e.,to achievea positivegrowthrate.?1)1(00Ak yN0*?pb?010?Ny bg17An extensionof thebasic model:two investments1.Utility function:2.Production function:3.Capital evolutionfunctions:?1t it it GAh y?C CifC Cify CUititit it110ln)1(ln1?),0(00011011?it t tt tti itit itNyIG IG Ghb hh184.Political institutions:democracy:simple majorityrulethe medianvoter dictatorship:the singleruler decidesthe taxrate andinfrastructure investment*Democracy*?ittititititit titititit itcNyGyyhyyUhyyc cUFOCUtit11111111,110:1:max?19*Democracy*?itt itittitit ittit titittit tititt ititNyGb hNc cifh yyc cif cyc yifby hc?1111110)1(120?Proposition I:Given thepreferences andproduction specifications,it followsthat ademocratic economy,characterized bymajority voting,is keptinazero-growth trapifthe initial ineofthemedianvoterfalls belowthe subsistentconsumption level().?The long run growthrate under democracy?cyi0?11111111?AN gdem21*dictatorship*?Proposition2:under followingcondition,the long-run equilibriumgrowthrateof relativelypoor dictatorshipexceeds theone inan equallypoor democracy.?cGNtt)1)(1(?N GyG yiff be iGybcUFOCb cNy yt syC Utt ittrtrttrtrtrtrrtrtit trtrtrtrctrt?11/11/0.1111:.ln)1(ln max1,22?The optimaltaxrateindictatorship?N ZZ Z ZNhGifZ Z ZNhGifZ ZZZNhGifUdemdem dicdicittdem dicdicittdem dicdic dicitttr?1?1110?1110?,?1110111111?dem dicdicdem dicdicdic dicZZZ ifZZZ ifZZif?,?23?The longrun growthrate underdictatorship?where?111111111NZZ ANgdicdic dic?dic demZN Z?124?Comparison oflong-run balancedgrowth ratesbetween twopolitical regimes?11111111?whereANg gdic dem25?Proposition3:If thenwe havea higherlongrungrowthrateunderdemocracythan dictatorship.?Roving bandits:?The“best dictatorship”:One sufficientcondition is:?1111111AN?11?0?1?2627When willa dictatorbe good?Economic Theory31 (2),pp.343-366LingShen281.Motivation andLiterature Dictatorialcountries:Index ofcivil liberties(1.0-7.0)bigger than6.0in1972/74.All datafrom UNand Barro-Lee1994.real GDPp.c.of somedictatorial countries1970-2000020004000600080001000012000140001970197219741976197819801982198419861988199019921994199619982000Congo(democratic rep.)Gabon Guinea-BissauMali MozambiqueUgandaChina Korea(South)Oman29?Question:Which incentiveslet adictator fosteror hindereconomicgrowth?Literature:McGuire andOlson (1996)Barro(1997,1999)Acemoglu et al.(2000,xx)?The politicaleconomy modelwith finitehorizon.30?A continuumof citizens,each inelasticallysupplies oneunit oflabor?Individual-specific productivity,uniform distribution?Production function:?indicator function:1invest;0dont invest?Investment cost:?Political institution:?Dictatorship:one ruleris unproductive,but hecanexpropriatevia taxation.?Democracy:no expropriation?Political transition(Gun Model)the paymentof citizens:the paymentof ruler:?Net incentivefor arevolt:2.Assumptions?1,0?a1,?aIt atNa Ay0,?e eAt?1,0),(?sc da Pat?t rulerP,?t rulerat tP c daP,aI0?dem?31?Timing:?The initialpolitical stateis dictatorship.?Dictator canobserve investmentdecision,but notproductivity.?Frictionless financialmarket,only inone period.?All playersare riskneutral.?Citizens ine:?Dictators ine:Parameters revealedCitizens:revolution ornot?Dictator:social transferInvestment ProductionTaxation t a at t at at eAI sy Y?)1(?da sy Y at attt ruler)(,?Dictator:represses ornot?revolution323.Exogenous economicgrowth:A growsexogenously?The taxrate:?Investment decision:?Assumption1:?Social transfer:?dic?ttt arulerss a a N As ada yYMaxt?1?121?110?S AseNifN eAeNifst ttt?,)1 (1)1 (2)1)(1()1 (1)1(0222?a as saastatat?;?0?)()(:?1,?,?invest noY investYatata?11?N AseAata t?11)1(eN33?Proposition1:1)If theprivateinvestmenthas noeffect onthe aggregatetechnical levelA,the dictatorwill bebad if;she willbe goodif.2)If thecondition holds,the transitionfrom thebad tothe good dictatorship isa Pareto-improving process.?The investmentratio:?The conditionofagooddictator:2)1 (1)1(?eN2)1 (1)1(?eN)1)(1(1?1?Nea bad)2)(1()1)(1(1?1?NN eagood2)1 (1)1(?eN?bada?1344.Revolution:?The incentivefor arevolt:?The lifetime ofthe dictator:?In thebad dictatorship:?In thegood dictatorship:?Proposition21)The incentivefor revolution increases inA.2)Effects ofthe taxrate andnature resourceare differentin goodand baddictatorship.cNeA tbadt?222)1)(1(2?cNe NAtgoodt?222)2)(1 (2)1()1(?cdaeaNAP cda Pdicdemaattruleratt?,)1(?)0(?tof rootthe T355.Endogenous economicgrowth?Assumption:private productivitybees publicgoods in the nextperiod.?Proposition3In theendogenous growthmod