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http://hdl.handle.net/10419/37178
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| Title: | | Markets and Jungles  |
| Authors: | | Gall, Thomas Masella, Paolo |
| Issue Date: | | 2010 |
| Series/Report no.: | | Beiträge zur Jahrestagung des Vereins für Socialpolitik 2010: Ökonomie der Familie - Session: Growth and Demography E5-V1 |
| Abstract: | | Economic institutions determine prospects for growth and development. In this paper a condition on the primitives determines whether an economy supports institutions that implement markets. Agents differ in land holdings, skill, and power. A competitive market assigns land to the skilled, not necessarily to the powerful. Therefore a market allocation needs to be robust to coalitional expropriation. More equally distributed power and higher congruence of land and power favor stable markets. Whether markets are stable forever in a dynamic setting, or alternate with expropriation in a limit cycle, decreasing efficiency and amplifying macroeconomic fluctuations, depends on social mobility, initial inequality, and the mismatch between demand and supply. |
| Subjects: | | Expropriation market institutions inequality fluctuations coalition formation |
| JEL: | | E00 O40 C71 |
| Document Type: | | Conference Paper |
| Appears in Collections: | | Jahrestagung des Vereins für Socialpolitik 2010 (Kiel): Ökonomie der Familie
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