The Role of the State in Economic Development

21 Pages Posted: 30 Apr 2005

See all articles by Guido Tabellini

Guido Tabellini

Bocconi University - Department of Economics; Bocconi University - IGIER - Innocenzo Gasparini Institute for Economic Research; Center for Economic Studies and Ifo Institute for Economic Research (CESifo)

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Abstract

This paper discusses the recent literature on the role of the state in economic development. It concludes that government incentives to enact sound policies are key to economic success. It also discusses the evidence on what happens after episodes of economic and political liberalizations, asking whether political liberalizations strengthen government incentives to enact sound economic policies. The answer is mixed. Most episodes of economic liberalizations are indeed preceded by political liberalizations. But the countries that have done better are those that have managed to open up the economy first, and only later have liberalized their political system.

Suggested Citation

Tabellini, Guido, The Role of the State in Economic Development. Kyklos, Vol. 58, No. 2, pp. 283-303, May 2005, Available at SSRN: https://ssrn.com/abstract=708684

Guido Tabellini (Contact Author)

Bocconi University - Department of Economics ( email )

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Bocconi University - IGIER - Innocenzo Gasparini Institute for Economic Research ( email )

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