Pampered Bureaucracy, Political Stability, and Trade Integration

Caleb Stroup and Benjamin Zissimos

No 1105, Vanderbilt University Department of Economics Working Papers from Vanderbilt University Department of Economics

Abstract: This paper shows how, under threat of revolution, a nation's elite are able to maintain political stability and hence ownership of their wealth by creating or expanding a `pampered bureaucracy.' The elite thus divert part of an otherwise entrepreneurial middle class from more productive manufacturing activities, reducing economic efficiency. If the country has a comparative advantage in primary products, trade integration is potentially destabilizing since it raises the payoff to the lower classes of mounting a revolution and challenging the elite for their wealth. In that case trade integration mandates expansion of the pampered bureaucracy. Therefore, trade integration may actually reduce economic efficiency. The econometric results provide supportive evidence for our model.

Keywords: Efficiency; inefficient institutions; property rights; social conflict; trade integration. (search for similar items in EconPapers)
JEL-codes: D30 D74 F10 O12 P14 (search for similar items in EconPapers)
Date: 2011-06
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.accessecon.com/pubs/VUECON/vu11-w05.pdf First version, April 2010, revised June 2011 (application/pdf)

Related works:
Journal Article: Pampered Bureaucracy, Political Stability and Trade Integration (2017)
Working Paper: Pampered Bureaucracy, Political Stability, and Trade Integration (2017)
Working Paper: Pampered Bureaucracy, Political Stability, and Trade Integration (2016)
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:van:wpaper:1105

Access Statistics for this paper

More papers in Vanderbilt University Department of Economics Working Papers from Vanderbilt University Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by John P. Conley ().