Topics in empirical political economy

Spring 2013 Professor: Ekaterina Zhuravskaya (EHESS), office 104 (Building A, Campus Jourdan), Email: ekaterina.zhuravskaya(at)parisschoolofeconomics.eu Office hours by appointment

The time and place of the sessions are presented at the end of this syllabus.

Asterisks denote required reading. Papers without asterisks are supplementary and intended for students with political economics as the main field.

Assignments: Referee reports (total of 2) on recent papers to be distributed in the first session of the course. In- class presentation of the report with slides.

Each referee report should be up to (and about to) 3 pages single-spaced. The report should start off with a one short paragraph summary of the main argument of the paper. It should proceed with the main criticisms of the paper. Conclude the report with minor comments. A good referee report not only clearly states the shortcomings of the work, but also lays out constructive, detailed and realistic suggestions for improvement.

The course consists of 8 sessions, each covers a separate topic. The time and place of the sessions are presented at the end of this syllabus.

Exam: take-home, referee report on an empirical paper on political economy to be distributed at the last session of the class.

Grade: class participation and class presentations 30%, referee report assignments 35%, exam 35%.

Students are strongly encouraged to attend the PEPES seminar (www.pepeseminar.net).

1. Political cycles, elections vs. appointments / Representation and Political Reservation

Cycles: * Timothy Besley & Stephen Coate, (2003). "Elected Versus Appointed Regulators: Theory and Evidence," Journal of the European Economic Association, MIT Press, vol. 1(5), pages 1176- 1206, 09. Akhmedov, A., Zhuravskaya, E. (2004) "Opportunistic Political Cycles: Test in a Young Democracy Setting," Quarterly Journal of Economics 119(4):1301-1338 Besley, T., Case, A., (1995) "Does Political Accountability Affect Economic Policy Choices? Evidence From Gubernatorial Limits," Quarterly Journal of Economics 110(3):769-98 Besley, T., Case, A., (2003) "Political institutions and policy choices: Evidence from the United States", Journal of Economic Literature 41:7-73 * Francesco Trebbi, Philippe Aghion, Alberto Alesina, 2008. "Electoral Rules and Minority Representation in U.S. Cities," The Quarterly Journal of Economics, MIT Press, vol. 123(1), pages 325-357, 02.

1 2. Economic Effects of Constitutions

* Acemoglu, D. (2005) "Constitutions, politics and economic growth: A review essay on Persson and Tabellini's "The Economic Effects of Constitutions", Journal of Economic Literature * Torsten P. "Forms of democracy, policy and economic development" , mimeo Persson, T., Tabellini, G. (2003) "The Economic Effects of Constitutions: : What Do the Data Say?" MIT Press, Ch. 3-9 Persson, T., Tabellini, G. (2004) "Constitutional rules and fiscal policy outcomes", American Economic Review 94:25-46 Persson, T., Tabellini, G., Trebbi, F. (2003) "Electoral rules and corruption", Journal of the European Economic Association 1:958-989 Persson, T. (2005) "Forms of democracy, policy, and economic development", NBER Working Paper, No. 11171 Persson, T., Tabellini, G. (2004) "Constitutions and economic policy", Journal of Economic Perspectives 18:75-98

3. Political Economics of Decentralization

* Enikolopov, R., and Zhuravskaya, E., (2008) "Decentralization and Political Institutions," Journal of Public Economics, 91 (11), 2007, pp. 2261-2290. * Pranab, B. (2002) "Decentralization of Governance and Development", Journal of Economic Perspectives, 16:185-205 Blanchard, O., and Shleifer, A. (2001) "Federalism with and without Political Centralization: China Versus Russia", IMF Staff Papers, 48:171-179 Zhuravskaya, E. (2000) "Incentives to Provide Local Public Goods," Journal of Public Economics 76(3): 337-368 Zhuravskaya, E. (2011) "Federalism in Russia," Forthcoming in Russia’s Balance-sheet E.Zhuravskaya, S. Guriev and E.Yakovlev ”Interest Group Politics in a Federation” Journal of Public Economics, 2010

REPORT 1, session 3: "Decentralization, Collusion and Coalmine Deaths" by Ruixue Jia, Huihua Nie

4. Conflict and Economic Performance

Alesina, A., Baqir, R., Easterly, W. (1999) "Public Goods and Ethnic Divisions", Quarterly Journal of Economics 114(4):1243-84 *Alesina and Zhuravskaya (2011) “Segregation and the quality of government,” AER 2012 * Miguel, E. (2005 ) "Poverty and Witch Killing", Review of Economic Studies, 72(4), 1153-1 Alberto Alesina & Reza Baqir & Caroline Hoxby, 2004."Political Jurisdictions in Heterogeneous Communities," Journal of Political Economy, University of Chicago Press, vol. 112(2), pages 348-396, April. Easterly, W., Levine, R. (1997) "Africa's Growth Tragedy: Policies and Ethnic Divisions", Quarterly-Journal-of-Economics, 112(4):1203-50 Alberto Alesina & Eliana La Ferrara, 2000."Participation In Heterogeneous Communities," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 847-904, August. Alesina, Alberto & La Ferrara, Eliana, 2002. "Who trusts others?," Journal of Public Economics, Elsevier, vol. 85(2), pages 207-234, August. Miguel, E. (2004) "Tribe or Nation? Nation-Building and Public Goods in Kenya versus Tanzania", World Politics, 56 (3), 327-362 Miguel, E. and Mary Kay Gugerty, (2005): "Ethnic Divisions, Social Sanctions, and Public Goods in Kenya", Journal of Public Economics, 89(11-12), 2325-2368 2 Edward Miguel & Shanker Satyanath & Ernest Sergenti, 2004."Economic Shocks and Civil Conflict: An Instrumental Variables Approach," Journal of Political Economy, University of Chicago Press, vol. 112(4), pages 725-753, August.

REPORT 2, session 4: “Conflict, Climate and Cells: A disaggregated analysis" by Mariaáavia Harari, Eliana La Ferrara

5. Political Persuasion of Media, effects and determinants of media freedom

DellaVigna, S., and M. Gentzkow (2011) “Persuasion: Empirical Evidence,” Annual Review of Economics. * DellaVigna, S. and E. Kaplan (2007). The Fox News effect: Media bias and voting. Quarterly Journal of Economics 122(3), 807-860. * Enikolopov, Petrova, and Zhuravskaya “Media and Political Persuasion: Evidence from Russia” (Forthcoming at AER, 2011) James M. Snyder & David Strömberg, 2010."Press Coverage and Political Accountability," Journal of Political Economy, University of Chicago Press, vol. 118(2), pages 355-408, 04. Egorov, G., S. Guriev, and K. Sonin (2009). Media freedom, bureaucratic incentives, and the resource curse, American Political Science Review 103(4), 645-668. Andrea Prat and David Strömberg 2010 "The Political Economy of Mass Media" CEPR Discussion Paper Series No. 8246.

REPORT 3, session 5: "Propaganda and Conflict: Theory and Evidence from the Rwandan Genocide" by David Yanagizawa-Drott

6. The value and the cost of political connections (November 15, 2011)

* Fisman, Raymond. (2001). “Estimating the Value of Political Connections”, American Economic Review, 91(4), 1095-1102. * Marianne Bertrand, Francis Kramarz; Antoinette Schoar, David Thesmar “Politicians, Firms and the Political Business Cycle: Evidence from France” (2008) mimeo. Fisman, David, Raymond Fisman, Julia Galef, and Rakesh Khurana, 2007, “Estimating the value of connections to Vice-President Cheney”, Working Paper. Irina Slinko & Ekaterina Zhuravskaya & Evgeny Yakovlev, 2005."Laws for Sale: Evidence from Russia," American Law and Economics Review, Oxford University Press, vol. 7(1), pages 284- 318.

REPORT 4, session 6: “The mortality cost of political connections » by Raymond Fisman, Yongxiang Wang

7. Regulation and corruption

* Aghion, P., Algan, Y., Cahuc, P. and Shleifer, A. (2009). ‘Regulation and Distrust’, NBER Working Paper No. w14648, National Bureau of Economic Research, Cambridge, MA, www.nber.org/papers/w14648.pdf. * Djankov, Simeon, Rafael La Porta, Florencio Lopez-de-Silanes, and Andrei Shleifer. 2002. “The Regulation of Entry.” Quarterly Journal of Economics 117(1):1–37. Fisman, Raymond and Edward Miguel. (2007). “Corruption, Norms, and Legal Enforcement: Evidence from Diplomatic Parking Tickets”, Journal of Political Economy, 115(6), 1020-1048. Mironov and Zhuravskaya “Corruption in Procurement and Shadow Campaign Financing: Evidence from Russia” mimeo

3 REPORT 5, session 7: «Teaching Practices and Social Capital » by Yann Algan Pierre Cahuc Andrei Shleifer

8. History and development Acemoglu, D., Johnson, S., Robinson, J., (2001) "The colonial origins of comparative development: An empirical investigation", American Economic Review 91:1369-1401 * Daron Acemoglu & Simon Johnson, 2005."Unbundling Institutions," Journal of Political Economy, University of Chicago Press, vol. 113(5), pages 949-995, October. Engerman, R., Sokoloff, K. "The Evolution Of Suffrage Institutions In The New World," Journal of Economic History, 2005, v65 (4,Dec), 891-921. Abhijit Banerjee & Lakshmi Iyer, 2005. "History, Institutions, and Economic Performance: The Legacy of Colonial Land Tenure Systems in India," American Economic Review, American Economic Association, vol. 95(4), pages 1190-1213, September. Glaeser, E., La Porta, R., Lopez-de-Silanes, F., and Shleifer, A. (2004) "Do Institutions Cause Growth?", Journal of Economic Growth, 9:271-303 * Nathan Nunn, 2009. "The Importance of History for Economic Development," Annual Review of Economics, Annual Reviews, vol. 1(1), pages 65-92, 05. Lakshmi Iyer, 2010. "Direct versus Indirect Colonial Rule in India: Long-Term Consequences," The Review of Economics and Statistics, MIT Press, vol. 92(4), pages 693-713, 05.

REPORT 6, session 8: “Gender and Missionary Influence in Colonial Africa » by Nathan Nunn

Calendar: Topics in empirical political economy of government and development mar. 5 févr. 09:20 – 12:20 Room A4 (campus Jourdan) mar. 12 févr. 09:20 – 12:20 Room A4 (campus Jourdan) mar. 19 févr. 09:20 – 12:20 Room Toumanian (CIUP Maison d'Arménie)++ mar. 26 févr. 09:20 – 12:20 Room Toumanian (CIUP Maison d'Arménie)++ mar. 19 mars 09:20 – 12:20 Room A4 (campus Jourdan) mar. 26 mars 09:20 – 12:20 Room A4 (campus Jourdan) mar. 2 avr. 09:20 – 12:20 Room A4 (campus Jourdan) mar. 9 avr. 09:20 – 12:20 Room A4 (campus Jourdan)

++ The Maison d'Arménie is located in front of Campus Jourdan, at 57 bd Jourdan, room Toumanian is on the floor -1 (once inside the building, there are posters and indications). The code to the main entrance door is 1927.

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