Munich Personal RePEc Archive

Rent-Seeking Government and Endogenous Takeoff in a Schumpeterian Economy

Chu, Angus C. (2020): Rent-Seeking Government and Endogenous Takeoff in a Schumpeterian Economy.

This is the latest version of this item.

[img]
Preview
PDF
MPRA_paper_107887.pdf

Download (345kB) | Preview

Abstract

This study explores how the rent-seeking behavior of the government may impede economic development and delay industrialization. Introducing a rent-seeking government to a Schumpeterian growth model that features endogenous takeoff, we find that a more self-interested government engages in more rent-seeking taxation, which delays the economy's transition from pre-industrial stagnation to modern economic growth. Quantitatively, a completely self-interested government could have delayed industrialization, relative to a benevolent government, by almost two centuries in the UK.

Available Versions of this Item

Logo of the University Library LMU Munich
MPRA is a RePEc service hosted by
the University Library LMU Munich in Germany.