Political Entry, Public Policies, and the Economy

Casey Mulligan and Kevin Tsui ()

No 13830, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper presents a theory of competition for political leadership between incumbent leaders and their challengers in which the possible equilibrium political market structures range from pure monopoly (unchallenged dictatorship) to perfectly competitive (ideal democracy). Leaders are constrained by the threat of "entry" or their ability to tax (or both), so that regimes with no challengers may nonetheless implement policies in the public interest. We offer economic interpretations of why democratic countries are associated with higher wages, why resource abundant countries tend to be nondemocratic, and how technological change affects political development. By focusing on the incentives for political entry, we show how trade sanctions and other policies designed to promote democracy may actually have the unintended consequences of discouraging political competition.

JEL-codes: H11 L12 P16 (search for similar items in EconPapers)
Date: 2008-03
New Economics Papers: this item is included in nep-cdm, nep-mic, nep-pbe and nep-pol
Note: IO PE POL
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Published as Mulligan, Casey B. & Tsui, Kevin K., 2015. "Political entry, public policies, and the economy," Research in Economics, Elsevier, vol. 69(3), pages 377-397.

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Journal Article: Political entry, public policies, and the economy (2015)
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