Endogenous institutional change after independence

Independence from colonial rule was a key event for both political and economic reasons. We argue that newly independent countries often inherited sub-optimal institutional arrangements, which the new regimes reacted to in very different ways. We present a model of endogenous changes in property rights institutions where an autocratic post-colonial elite faces a basic trade-off between stronger property rights, which increases the dividends from the modern sector, and weaker property rights that increases the elite's ability to appropriate resource rents. The model predicts that revenue-maximizing regimes in control of an abundance of resource rents and with insignificant interests in the modern sector will rationally install weak institutions of private property, a prediction which we argue is well in line with the experience of several developing countries.     

Economic theory and econometric dynamics in modelling wages and prices in the United Kingdom

We show that a “competing claims” model of imperfect competition can explain the movements of wages and prices in the United Kingdom, using quarterly data covering 1976–93. We argue that careful attention both to economic theory and to the interaction between dynamics and identification is crucial in the building of the model and to dynamic econometric models in general. We use a small numerical example with simulated cointegrated data to illustrate the potential pitfalls. First version received: January 1998/final version received: November 1998     

Methods in futures studies: A view from the theory of science

Viewing forecasting in terms of three modes, as predictions deduced from tested scientific theories, as trend extrapolations, and as heuristics, it is shown that most long-term predictions are inherently contingent. They do not tell us what will happen unconditionally, but what will happen, in case something else happens. Hence futures studies will not show us any predetermined future, but rather different ways of shaping the future. Scientific predictions, trend extrapolation, and heuristic methods are the most important approaches to forecasting. If they are properly understood, this will help understanding other less important methods also.     

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Citizens' support for Economic Reforms in Sub‐Saharan Africa

The objective of this paper is to investigate the factors that influence citizens' support for costly economic reforms in sub‐Saharan Africa. This is relevant for several reasons, but the most obvious perhaps is that economic reform will be difficult if faced by strong resistance from citizens. In this paper, individual data from Round 4 of the Afrobarometer surveys is used to investigate how support for economic reforms is influenced by factors falling under the following broad categories: (i) Economic variables; (ii) group identity and fairness variables; (iii) Institutional and state/government variables; (iv) Demographic and control variables. An individual's trust in the president and the belief that the government manages the economy well are two of the most significant and robust factors. This is in keeping with the results found in Williamson (The Political Economy of Policy Reform, Institute for International Economics, Washington, DC, 1994 ). Another robustly significant variable is satisfaction with how democracy works in the country. Variables related to ethnic identity and community membership also play a significant role in support for costly economic reforms, which is in line with the theories put forward by van de Walle (African Economies and the Politics of Permanent Crisis, 1979–1999. Cambridge University Press, New York, 2001 ). Females are less likely to support economic reforms, while individuals with higher levels of education are more likely to support economic reforms.