EconPapers    
Economics at your fingertips  
 

Dictators and oligarchs: A dynamic theory of contested property rights

Sergei Guriev () and Konstantin Sonin ()

Journal of Public Economics, 2009, vol. 93, issue 1-2, 1-13

Abstract: In an economy with weak economic and political institutions, the major institutional choices are made strategically by oligarchs and dictators. The conventional wisdom presumes that as rent-seeking is harmful for oligarchs themselves, institutions such as property rights will emerge spontaneously. We explicitly model a dynamic game between the oligarchs and a dictator who can contain rent-seeking. The oligarchs choose either a weak dictator (who can be overthrown by an individual oligarch) or a strong dictator (who can only be replaced via a consensus of oligarchs). In equilibrium, no dictator can commit to both: (i) protecting the oligarchs' property rights from the other oligarchs and (ii) not expropriating oligarchs himself. We show that a weak dictator does not limit rent-seeking. A strong dictator does reduce rent-seeking but also expropriates individual oligarchs. We show that even though eliminating rent-seeking is Pareto optimal, weak dictators do get appointed in equilibrium and rent-seeking continues. This outcome is especially likely when economic environment is highly volatile.

Keywords: Property; rights; Oligarchy; Dictatorship; Non-democratic; politics (search for similar items in EconPapers)
Date: 2009
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (9) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0047-2727(08)00120-5
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Dictators and Oligarchs: A Dynamic Theory of Contested Property Rights (2008) Downloads
Working Paper: Dictators and Oligarchs: A Dynamic Theory of Contested Property Rights (2007) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:pubeco:v:93:y:2009:i:1-2:p:1-13

Access Statistics for this article

Journal of Public Economics is currently edited by R. Boadway and J. Poterba

More articles in Journal of Public Economics from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2018-09-29
Handle: RePEc:eee:pubeco:v:93:y:2009:i:1-2:p:1-13