Political Instability and Growth in Dictatorships

Jody Robert Overland (), Kenneth L. Simons and Michael Spagat ()

No 354, William Davidson Institute Working Papers Series from William Davidson Institute at the University of Michigan Stephen M. Ross Business School

Abstract: We model growth in dictatorships facing each period an endogenous probability of ``political catastrophe'' that would extinguish the regime's wealth extraction ability. Domestic capital exhibits a bifurcation point determining economic growth or shrinkage. With low initial domestic capital the dictator plunders the country's resources and the economy shrinks. With high initial domestic capital the economy eventually grows faster than is socially optimal.

Keywords: dictatorship; growth; political economy; bifurcation (search for similar items in EconPapers)
JEL-codes: D9 O1 H (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev, nep-pbe and nep-pol
Date: 2000-11-01
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Related works:
Working Paper: Political Instability and Growth in Dictatorships (2003)
Working Paper: Political Instability and Growth in Dictatorships (2000)
Journal Article: Political instability and growth in dictatorships (2005)
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Persistent link: http://EconPapers.repec.org/RePEc:wdi:papers:2000-354

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