The Logic of Hereditary Rule: Theory and Evidence

32 Pages Posted: 17 Jan 2017

See all articles by Timothy J. Besley

Timothy J. Besley

London School of Economics & Political Science (LSE) - Department of Economics; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Marta Reynal-Querol

World Bank - Development Research Group (DECRG); Universitat Pompeu Fabra - Faculty of Economic and Business Sciences

Date Written: January 2017

Abstract

Hereditary leadership has been an important feature of the political landscape throughout history. This paper argues that hereditary leadership is like a relational contract which improves policy incentives. We assemble a unique dataset on leaders between 1874 and 2004 in which we classify them as hereditary leaders based on their family history. The core empirical finding is that economic growth is higher in polities with hereditary leaders but only if executive constraints are weak. Moreover, this holds across of a range of specifications. The finding is also mirrored in policy outcomes which affect growth. In addition, we find that hereditary leadership is more likely to come to an end when the growth performance under the incumbent leader is poor.

Keywords: growth, Hereditary Institutions, political agency

JEL Classification: H11, N40, O11

Suggested Citation

Besley, Timothy J. and Reynal-Querol, Marta and Reynal-Querol, Marta, The Logic of Hereditary Rule: Theory and Evidence (January 2017). CEPR Discussion Paper No. DP11777, Available at SSRN: https://ssrn.com/abstract=2900194

Timothy J. Besley (Contact Author)

London School of Economics & Political Science (LSE) - Department of Economics ( email )

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Marta Reynal-Querol

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