POLITICAL PREDATION AND ECONOMIC DEVELOPMENT

We analyze a game between citizens and governments, whose type (benevolent or predatory) is unknown to the public. Opportunistic governments mix between predation and restraint. As long as restraint is observed, political expectations improve, people enter the modern sector, and the economy grows. Once there is predation, the reputation of the government is ruined and the economy collapses. If citizens are unable to overthrow this government, the collapse is durable. Otherwise, a new government is drawn and the economy can rebound. Consistent with stylized facts, equilibrium political and economic histories are random, unstable, and exhibit long-term divergence.     

WHAT DO CITIZENS THINK ABOUT PUBLIC ENTERPRISES? SUBJECTIVE SURVEY DATA ON THE LEGITIMACY OF THE ECONOMIC ACTIVITIES OF THE GERMAN PUBLIC SECTOR

We analyse the legitimacy of public enterprises that perform economic activities by focusing on the citizens’ subjective preferences, i.e. determining their political legitimacy. Using data from a representative survey conducted among 318 citizens of the German state of Rhineland‐Palatine, we explore determinants for the support of either privatisation efforts or the instrumental thesis, a widespread principle in German‐speaking countries, which considers public enterprises solely as instruments to fulfil economic policy objectives. Our results indicate that the respondents’ perception of the efficiency of public enterprises as well as their personal economic situation are important factors for the support of privatisation. The influential factors for the use of public enterprises as policy instruments are political ideology, the perception of a higher security of supplying goods and services as well as opinions regarding corporate social responsibility. The subjective preferences of a (democratic) country's citizens are thus an important reason why the public sector should or should not play an active part in providing goods and services. This can play an important role when decision makers from the public sector are keen to take into account the citizens’ approval or disapproval of privatisation measures.     

TOWARDS A PARADIGM OF DEMOCRATIC PARTICIPATION: CITIZEN PARTICIPATION AND CO-PRODUCTION OF PERSONAL SOCIAL SERVICES IN SWEDEN

ABSTRACT:  Many countries in Europe are now searching for new ways to engage citizens and involve the third sector in the provision and governance of social services in order to meet major demographical, political and economic challenges facing the welfare state in the 21st Century. Co-production provides a model for the mix of both public service agents and citizens who contribute to the provision of a public service. Citizen participation involves several different dimensions: economic, social, political and service specific. The extent of citizen participation varies between different providers of welfare services, as too does user and staff influence. Empirical materials from a recent study of childcare in Sweden will be used to illustrate these points. However, the role of citizens and the third sector also varies between countries and social sectors. Third sector providers facilitate citizen participation, while a glass ceiling for participation exists in municipal and for-profit providers. Moreover, co-production takes place in a political context, and can be crowded-in or crowded-out by public policy. These findings can contribute to the development of a new paradigm of participative democracy.     

What Happened to the Japanese Model?

Japan's steep postwar growth was nested in a political economy built around producer‐oriented policies: by fostering the growth of large firms using the tools of industrial policy, the government could jumpstart development. Many large firms, and their employees, benefited indirectly from this growth program, and very small firms and industries not included in the growth model were compensated through preferential policies or subsidies. Japan's social contract evolved around this system, having as its centerpiece lifetime employment. The government spent more resources on supporting exporting industries and compensating domestic ones than on building a forward‐looking welfare system. Japan's decade‐long economic downturn marks a structural transition towards a postindustrial society. While excelling in producing tangibles, Japan has fallen behind in fostering modern industries, including services; the country also lacks a welfare system to handle increasing structural unemployment that this transition brings about. Without a commitment towards a welfare system and a welfare society, and a reorientation of the social contract towards citizens, Japan is unlikely to transition successfully.     

Are electronic government innovations helpful to deter corruption? Evidence from across the world

Electronic government innovations have been a critical development in public administration in recent years. Many countries have implemented e-government policies to enhance efficiency and transparency and combat corruption. This paper examines the impact of e-government on corruption using longitudinal data for more than 170 countries from 2002 to 2020. The empirical results suggest that e-government serves as a deterrent to corrupt activities. We analyse which e-government domains affect corruption, which types of corruption are more affected by e-government and the circumstances under which e-government is more effective in reducing corruption. The empirical results suggest that online service completion and e-participation are important features of e-government as an anticorruption tool. Evidence suggests that e-participation reduces corrupt legislature activities, public sector theft, executive bribery, and corrupt exchanges. The potential of e-government to deter corruption is higher in countries where corruption is moderate or high and economic development is lower. Higher levels of GDP per capita, foreign direct investment, and political rights are also associated with lower levels of corruption.     

企业家出身造成了产能过剩吗*——来自中国企业—劳动力匹配调查（CEES）的经验证据

多年来,产能过剩一直是制约我国经济迈向高质量发展的重要障碍。与现有文献多从宏观产业政策层面研究上述问题有所不同,本文选取企业家公共部门出身这一微观视角,运用政治关联理论,就企业家出身造成我国企业产能过剩的微观机理进行了创新性的实证解释。运用“中国企业—劳动力匹配调查”（CEES）数据,本文的基准回归表明,为获取政治关联所带来的非市场回报,在其他因素既定的前提下,对于出身公共部门的企业家而言,其所在企业的产能过剩程度平均偏高139%,出现产能过剩问题的边际概率则平均偏高53%。内生性检验、中介效应模型的估计结果发现,与宏观产业政策相比,企业家公共部门出身对于产能过剩的影响效应具有更高的经济显著性,而过度投资则是其中的重要影响途径。运用上市公司的微观面板数据,同源性误差检验进一步支持了本文的主要实证 发现。为此,本文的政策建议是：政府应该将政策重心从产业政策转向竞争性政策,通过构建公平竞争的市场环境,厘清政府与市场二者的边界,避免企业家依靠政治关联对政府资源的“俘获”。只有构建公平竞争的市场经济秩序,企业家的创新潜能才能得到充分释放,并从微观机理上解决我国的产能过剩问题。     

Does public‐sector employment fully crowd out private‐sector employment?

Employment matters for development because it can raise household income, lower inequality, promote economic growth, and contribute to political stability. Many countries have high rates of public employment, but what effect does this have on overall employment and unemployment rates? This paper investigates if and to what extent public‐sector employment crowds out (reduces) private‐sector employment. In particular, we estimate regressions of unemployment or private‐sector employment on two measures of public‐sector employment. The study uses an especially assembled dataset, which is novel for its coverage of a large sample of developing countries as part of a panel of rich and poor countries. Our results point to full or just about full crowding‐out for the entire sample. Unlike previous cross‐country studies, which were restricted to advanced economies, we are able to show that these results also apply to developing countries, although crowding‐out may not be quite as high as in advanced economies. The results mean that high rates of public employment have an offsetting large negative impact on private employment rates and do not reduce overall unemployment rates. With the qualifier that government activities may help the economy in other ways, our results imply that, rather than creating public‐sector jobs, scarce fiscal resources could be better spent on other developmental needs.     

Coups,revolutions and efficient policies in autocracies

The purpose of this paper is to explore the interaction of two mechanisms that might constrain the power of dictators: the threat of a coup by the selectorate and a revolution by citizens. Our results help explain a stylized fact, namely that autocracies are far more likely to be either the best or the worst performers in terms of growth and public goods policies. To this end, we focus on accountability within dictatorships using a model where both the selectorate and the citizens are the principals and the autocrat is the agent. Our results highlight that both excessively strong and excessively weak dictators lead to poor economic performances, and that a balanced distribution of de facto political power is required to incentivize the dictator to choose efficient economic policies.     

Government Spending and Taxation in Democracies and Autocracies

The paper develops a theoretical rationale for a non-linear relationship between the level of democracy and government spending. A model is presented showing why and how political participation influences the spending behavior of opportunistic governments that can choose an optimal combination of rents and public goods to attract political support. If the level of democracy remains low, governments rationally prefer rents as an instrument to assure political support. With increasing democratic participation, however, rents become an increasingly expensive (per unit of political support) instrument while the provision of public goods becomes more and more efficient in ensuring the incumbent government's survival in power. As a consequence, an increase in democracy, which drives a country from a pure autocracy to a semi-participatory system, tends to reduce government spending, while an increase in political participation from a semi-participatory country to a full democracy tends to raise the size of the public sector.     

On the release of information by governments: Causes and consequences

The release of economic and social data by a government provides many benefits to its citizens on a number of different levels. Information has value in itself (for example, to facilitate a more efficient allocation of resources), but it could also perhaps be seen as a signal of the degree of political and institutional transparency. In order to evaluate the potential association between the release of information and the institutional and economic circumstances across countries, a new index is developed that has extensive coverage across countries (175) and time (1960–2000), and is based on the quantity of reported socio-economic data contained in the World Development Indicators and the International Finance Statistics databases. Using a series of Granger-causality regressions, the release of information by governments is shown to have a significant positive effect on the quality of the bureaucracy in the short run and, in the longer term, a significant effect on investment and financial sector development. In terms of reverse causality, the evidence shows that the degree of constraints on the executive branch of government and education both have a positive effect on the quantity of data released by governments.     

MANAGEMENT TRAINING IN INDONESIAN PUBLIC ENTERPRISES: Concepts and Approaches

ABSTRACT * : The improvement of the proficiency and capabilities of management staff of public enterprises (BUMN) in Indonesia has become more important with the introduction of a public sector policy which focuses on the efficiency, cost recovery and profitability of public enterprises. Management training in Indonesian BUMN is in most cases an instrument of career development for management staff. Training programmes continue to be influenced by the training concepts of the civil service and reflect the fact that despite the business orientation of the official public sector policy, BUMN continue to be part of the political/administrative system. Business orientation, efficiency, entrepreneurship and profit orientation are seen as the most important characteristics of BUMN managers to be developed in the training programmes; however, management training also aims at the political socialization of BUMN managers into the national leadership. In the implementation of management training, public enterprises tend to cooperate most closely with their respective technical departments and the university sector. Considering the objectives of the public sector policy of the government, BUMN should be allowed to design and implement their management training without interference from other central government institutions.     

Political agency,government responsiveness and the role of the media

The role of mass media in making governments responsive to the needs of citizens is a relatively neglected area in economics. We sketch a theoretical example with a role for media in enhancing government responsiveness based on asymmetric information between citizens and government. We then use data for the period 1958–1992 on the extent to which Indian state governments responded to food shortages via the public distribution of food, correlating these with proxies of media, political and economic development. We find that states that are more responsive tend to also be those with high levels of newspaper circulation, electoral turnout and literacy. In contrast, richer states do not tend to be more responsive than poorer states.     

Evolution of Risk and Political Regimes

The risk of political predation impedes the achievement of economic prosperity. In this study, we analyze how the risk of predation evolves in different political regimes. Formally, we look at the interaction between a government and citizens in which, in each period, the government has an option to predate. Citizens prefer governments that are competent and non‐predatory and strive to replace ones that are not. Regimes differ in the degree to which citizens can succeed in doing so. In pure democracies, citizens can displace incumbent governments; in pure autocracies, they cannot; and in intermediate cases, they can do so in probability. After economic downturns, the posterior probability that the government is competent and benevolent declines. According to the model, in intermediate regimes, but not in others, governments can separate by type. One implication, then, is that these regimes are politically and economically more volatile, with higher levels of variation in assessments of political risk and in economic performance. Another is that in such regimes, political leadership can make an economic difference. Empirically, we test our argument by measuring the impact of economic downturns on the perceived risk of political expropriation in different regime types, using as instruments the incidence of natural disasters and unexpected terms of trade shocks.     

提高城市公共品供给效率的研究与探讨

随着时代的进步,城市公共品的供给已经成为衡量一个城市甚至是一个国家文明及进步程度的关键因素.本文首先对城市公共品进行了界定,分析了现有城市公共品的主要供给模式.然后针对当前我国城市公共品供给存在的主要问题:政府和公共部门的过度干预控制,而私人部门或是第三部门在城市公共品的供给过程中参与程度却比较低,整体供给效率不高等,进一步剖析其原因.最后指出为了提高我国城市公共品的供给效率,应继续推进并不断地深化城市公共品的供给市场化改革思路,进行配套地改革,建立起多样化的投融资模式;进一步探求多样化的公共品供给模式,以地方政府和民间资本为城市公共品的有效供给者;建立和规范规制机构,建立健全补偿机制和供给机制;转变政府的职能角色,由“划桨”向“掌舵”进行转变,树立起服务理念;同时还要提高市民享有城市公共品的权利意识.     

DEFINING AND MEASURING THE PUBLIC SECTOR: SOME INTERNATIONAL COMPARISONS

The public sector is defined here to include government plus public enterprises. Historically, economists and statisticians have been more concerned with its separate components than with the public sector as a whole, but it is suggested that the public sector may be an appropriate concept for studying several current problems of economic policy. While there is general agreement as to what constitutes government, countries have differing views about what makes an enterprise public. Differences in country definitions of public enterprises are identified as one of the main problems in making international comparisons for the public sector. Statistics are presented for up to 16 OECD countries on the share of the public sector in total final demand, value added, employment, and net lending. It is argued that there is rarely a unique answer to the question “How big is the public sector?” For most countries judicious selection of data and careful definition will lead to different conclusions about the size and growth of the public sector. Because of the lack of data, it is not possible to analyse public sectors in developing countries in the same detail as OECD countries. The evidence available suggests that while public sectors are about the same size in both OECD and developing countries, public enterprises play a more important role in the latter.     

Club governments versus representative governments

The paper compares the legal rules for private clubs with the constitutions of representative governments. Though both institutions are designed to provide public goods for their members they are organized quite differently. In clubs the power to grant power must not be delegated to the agents, while in representative governments it usually is. The design of representative governments is shown to be inconsistent with a contractarian view of the constitution. A nearly perfect laboratory case for a club government can be found in the example of Switzerland. In this country citizens are absolute sovereigns over their constitution. The Swiss do not have a constitutional court, but have developed instead a system of popular voting rights serving as a substitute for a judicial review by a constitutional court. Though this system does not work perfectly, it has relative advantages compared to a constitutional court which often tends to become a political decisionmaker. The author is indebted to Pio Baake, Peter Moser, and Richard E. Wagner for helpful comments.     

The quality of government

We investigate empirically the determinants of the quality ofgovernments in a large cross-section of countries. We assessgovernment performance using measures of government intervention,public sector efficiency, public good provision, size of government,and political freedom. We find that countries that are poor,close to the equator, ethnolinguistically heterogeneous, useFrench or socialist laws, or have high proportions of Catholicsof Muslims exhibit inferior government performance. We alsofind that the larger governments tend to be the better performingones. The importance of (reasonably) exogenous historical factorsin explaining the variation in government performance acrosscountries sheds light on the economic, political, and culturaltheories of institutions.     

转型期中国县级政府的客观治理绩效与政治信任——从“经济增长合法性”到“公共产品合法性”

善治是中国政府的执政要务,政治信任反映着公民对政府治理的认可和支持。文章利用2008年中国公民意识调查及政府统计数据,实证分析了政府治理绩效的主观和客观维度对政治信任的影响。研究发现,公民对政府在经济增长、民生福利、纯公共产品领域治理绩效的回顾性和前瞻性积极评价都正相关于政治信任;纯公共产品提供的主观评价对政治信任的影响大于经济增长和民生福利。县级政府的客观治理绩效对政治信任有重要影响,在高人均福利支出、低基尼系数和低失业率的县级单位,政治信任更高,而人均GDP反而微弱地负作用于政治信任。因此,尽管经济增长仍然是政治信任的重要来源,但民生福利和纯公共产品正赶上并超越经济增长,成为公民提供政治信任的新源泉。     

Ethnicity, Politics and Economic Performance

The paper investigates the effects of ethnic diversity on economic performance. Previous studies have found that diversity has various detrimental microeconomic effects, tending to reduce public sector performance, and has large detrimental effects on the overall growth rate. I develop a simple model of the effect of ethnic diversity on a government decision problem in which there is a tradeoff between growth and distribution, in the contexts of democracy and dictatorship. I find that in democracy ethnic diversity has no effect upon the decision, whereas in dictatorship ethnic diversity leads to a government choice which reduces the growth rate. I then test these propositions on two data sets. The first is for 94 countries over the period 1960–1990. I find that whether diversity adversely affects overall economic growth depends upon the political environment. Diversity is highly damaging to growth in the context of limited political rights, but is not damaging in democracies. The second is for World Bank projects in 89 countries. I find that the same relationship between diversity and democracy affects the proportion of projects which are successful.