Political Economy of Mechanisms.

We study the provision of dynamic incentives to self-interested politicians who control the allocation of resources in the context of the standard neoclassical growth model. Citizens discipline politicians using elections. We show that the need to provide incentives to the politician in power create...

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Publicado en:Econometrica Vol. 76; no. 3; pp. 619 - 642
Autores principales: Acemoglu, Daron, Golosov, Michael, Tsyvinski, Aleh
Formato: Artículo
Publicado: Wiley-Blackwell May 2008
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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        10.1111/j.1468-0262.2008.00849.x
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        atl: Political Economy of Mechanisms.
      aug:
        au:
          Acemoglu, Daron
          Golosov, Michael
          Tsyvinski, Aleh
      su:
        Resource allocation -- Mathematical models
        Economics & politics
        Taxation
        Mathematical models
      sug:
        subj:
          Resource allocation -- Mathematical models
          Economics & politics
          Taxation
          Mathematical models
      ab: We study the provision of dynamic incentives to self-interested politicians who control the allocation of resources in the context of the standard neoclassical growth model. Citizens discipline politicians using elections. We show that the need to provide incentives to the politician in power creates political economy distortions in the structure of production, which resemble aggregate tax distortions. We provide conditions under which the political economy distortions persist or disappear in the long run. If the politicians are as patient as the citizens, the best subgame perfect equilibrium leads to an asymptotic allocation where the aggregate distortions arising from political economy disappear. In contrast, when politicians are less patient than the citizens, political economy distortions remain asymptotically and lead to positive aggregate labor and capital taxes. Reprinted by permission of the publisher.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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