Dangerous democracies

Devolution in (Non-)Democracies

The paper develops a very simple model explaining the process of devolution of an individual region in a politically asymmetric country, where a region and the central government bargain over the distribution of tax revenue given a particular tax rate, focusing on the impact of political regime on the decentralization outcome. It finds that under most political settings large regions, regions w...

Do Democracies Attract Portfolio Investment?

Corruption and power in democracies

According to Acton: “Power corrupts and absolute power corrupts absolutely”. We study the implications of Acton’s dictum in models where citizens vote (for three parties) and governments then form in a series of elections. In each election, parties have Þxed tastes for graft, which affect negotiations to form a government if parliament hangs; but incumbency changes tastes across elections. We a...

Crime in New Democracies ∗

Crime rates have surged in nearly all new democracies. To explain this empirical regularity, we model the effects of political regimes on law enforcement and parametrize political regimes by their vulnerability to violent overthrow. It is assumed that democracies are less vulnerable than dictatorships. We first show that dictatorships generate more investment in “political protection” or secret...

Government Turnover in Parliamentary Democracies

In this paper we consider a dynamic model of government formation and termination in parliamentary democracies that accounts for the following phenomena: (1) Cabinet terminations due to replacement or early election (2) Cabinet reshuf°es (3) Minority and Surplus governments; (4) the relative instability of minority governments. JEL classi ̄cation: D72, H19, C73.