Explaining Africa's Growth Tragedy: A Theoretical Model of Dictatorship and Kleptocracy

Yuan K. Chou and Hayat Khan

No 922, Department of Economics - Working Papers Series from The University of Melbourne

Abstract: In this paper, we construct a dynamic model of a kleptocratic dictatorship to explain sub-Saharan Africa’s dismal economic performance between the early 1970s and the mid-1990s. The dictator’s objective is to maximize a discounted stream of revenue generated through theft of the economy’s output by choosing the optimal expropriation rate and the size of the security force employed to enforce his rule. The model is used to evaluate alternative intervention options open to developed countries such as unconditional, conditional and selective foreign aid, financial and military assistance to rebel groups, as well as medical relief to combat the HIV/AIDs pandemic.

Keywords: Economic performance; dictatorship; foreign aid; Africa (search for similar items in EconPapers)
JEL-codes: D78 O11 O17 O55 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2004
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Citations: View citations in EconPapers (2)

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