Ivan Lyubimov to speak on ‘ Extractive Institutions, Closed Borders and Economic Development ’ at HSE/NES Research Seminar

On October 21, 2014 a research seminar on political economy will take place at the HSE. The event is organized by the Higher School of Economics and the New Economic School. Ivan Lyubimov (Moscow Institute for Physics and Technology, Gaydar Institute for Economic Policy) will speak on ‘Extractive Institutions, Closed Borders and Economic Development’.

Abstract:

Autocratic regimes often limit access to information concerning the outside world, to prevent their citizenry from learning about the comparatively poor performance of their economy. In this paper, we analyze the use of censorship, and consider it as an information asymmetry problem, in the context of an augmented Solow growth model. We find that higher technological backwardness, lower quality of domestic institutions, low level of income inequality and low costs of collecting information about foreign economies lead to more restrictive and comprehensive censorship. These findings are consistent with stories of socialist dictatorships, as the Soviet Union or North Korea, where very restrictive forms of censorship, as political isolationism, were/are used. We also explain why these forms of censorship are less popular now. We argue that isolationism reduces opportunities for adoption of technologies, which results in underdevelopment, higher vulnerability to negative shocks, and potentially higher political turbulence. To avoid these outcomes, a political regime can prefer not to implement the most strict forms of censorship. This finding is in line with censorship policy which is applied in nowadays China.

Start time: 6:15 pm

Address: 26 Shabolovka Ulitsa, Building 4, Room 4322.

Everyone interested is welcome.
If you need a pass to the HSE, please contact political.economy.hse@gmail.com  before 12:00, Tuesday October 21.