Economists have long been interested in the idea that there is a direct circular relation
between poverty and low productivity, and not just one that is mediated by market failures,
usually in asset markets. The nutrition-based e¢ ciency wage model (Partha Dasgupta and
Debraj Ray, 1987) is the canonical example of models where this happens: However it
has been variously suggested (see for example T. N. Srinivasan, 1994) that the link from
nutrition to productivity and especially the link from productivity to nutrition is too weak
to be any more than a small part of the story. Partha Dasgupta himself acknowledges this
when he writes "nutrition-productivity construct provides a metaphor... for an economic
environment harboring poverty traps."
Presented at the American Economic Association, January 4, 2008. Download PDF
Social scientists have long emphasized the importance of institutions in nurturing economic growth and development. Douglass C. North defines institutions as the "rules of the game in a society" which limit the set of choices for individuals and argues that institutions, both formal ones such as laws and constitutions, as well as informal ones such as social norms, are important in determining the transaction costs of production and exchange, and thereby have an impact on economic growth. He goes on to discuss the mostly incremental nature of institutional change and highlights the difficulties in implementing radical institutional change. This line of argument therefore suggests that the impacts of institutions are likely to be felt for a very long time, and hence points to the need for detailed historical analysis over long periods in order to quantify the impact of institutions.
This paper examines how increased voter ethnicization, defined as a greater preference for the
party representing one's ethnic group, affects politician quality. If politics is characterized by
incomplete policy commitment, then ethnicization reduces average winner quality for the pro-majority party with the opposite true for the minority party. The effect increases with greater
numerical dominance of the majority (and so social homogeneity). Empirical evidence from
a survey on politician corruption that we conducted in North India is remarkably consistent
with our theoretical predictions.
Also Faculty Research Working Papers Series, John F. Kennedy School of Government. Download PDF