Entitlement to assort: Democracy, compromise culture and economic stability
Jiabin Wu ()
Economics Letters, 2018, vol. 163, issue C, 146-148
We propose a simple model to support Rodrik’s (2000) conjecture that democracy lowers economic instability through breeding compromise culture. In the model, a population of compromisers and opportunists collectively bargain over the assortativity level of matching through a democratic political institution. We show that compromisers are able to achieve a positive level of assortativity which helps them to avoid matching with opportunists. This in turn raises compromisers’ payoffs above opportunists’ and eventually compromisers dominate the population through cultural evolution.
Keywords: Democracy; Economic stability; Assortativity; Entitlement; Evolutionary game theory (search for similar items in EconPapers)
JEL-codes: C73 D72 O10 Z10 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:163:y:2018:i:c:p:146-148
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