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State Capacity and Economic Development: A Network Approach

The American economic review, 2015-08, Vol.105 (8), p.2364-2409 [Peer Reviewed Journal]

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Title:
State Capacity and Economic Development: A Network Approach
Author: Acemoglu, Daron ; García-Jimeno, Camilo ; Robinson, James A.
Subjects: Bureaucracy ; Correlations ; Economic development ; Economic models ; Enrollment rate ; Enrollments ; Equilibrium ; Estimates ; Instrumental variables estimation ; Linear models ; Poverty ; Prosperity ; Public goods ; Public utilities ; State agencies ; Statistical median
Is Part Of: The American economic review, 2015-08, Vol.105 (8), p.2364-2409
Description: We study the direct and spillover effects of local state capacity in Colombia. We model the determination of state capacity as a network game between municipalities and the national government We estimate this model exploiting the municipality network and the roots of local state capacity related to the presence of the colonial state and royal roads. Our estimates indicate that local state capacity decisions are strategic complements. Spillover effects are sizable, accounting for about 50 percent of the quantitative impact of an expansion in local state capacity, but network effects driven by equilibrium responses of other municipalities are much larger.
Publisher: Nashville: American Economic Association
Language: English
Identifier: ISSN: 0002-8282
EISSN: 1944-7981
DOI: 10.1257/aer.20140044
CODEN: AENRAA
Source: AUTh Library subscriptions: ProQuest Central

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