Research Papers

We distinguish between ideational and interest-based appeals to voters on the supply side of politics, integrating the Keynes-Hayek perspective on the importance of ideas with the Stigler-Becker approach emphasizing vested interests. In our model, political entrepreneurs discover identity and worldview “memes” (narratives, cues, frames) that invoke voters’ identity concerns or shift their views of how the world works. We identify a complementarity between worldview politics and identity politics and illustrate how they may reinforce each other. Furthermore, we show how adverse economic shocks (increasing inequality) lead to greater incidence of ideational politics. We use these results to analyze data on 60,000 televised political ads in U.S. localities over the years 2000 through 2018. Our empirical work quantifies ideational politics and provides support for key model implications, including the impact of higher inequality on the supply of both identity and worldview politics.

Using Fontana et al.’s (2019) database, we analyze levels and trends in the global distribution of authorship in economics journals, disaggregating by country/region, quality of journal, and fields of specialization. We document striking imbalances. While Western and Northern European authors have made substantial gains, the representation of authors based in low-income countries remains extremely low -- an order of magnitude lower than the weight of their countries or regions in the global economy. Developing country representation has risen fastest at journals rated 100^th or lower, while it has barely increased in journals rated 25^th or higher. Fields such as international or development where global diversification may have been expected have not experienced much increase in developing country authorship. These results are consistent with a general increase in the relative supply of research in the rest of the world. But they also indicate authors from developing countries remain excluded from the profession’s top-rated journals.

Conventional welfare state policies that center on education, training, progressive taxation, and social insurance are inadequate to address labor market polarization, which is capitalism’s most pressing inclusion challenge at present. We propose a strategy aimed directly at the productive sphere of the economy and targeting an increase in the supply of ‘good jobs. The main elements of this strategy are: (i) active labour market policies linked to employers; (ii) industrial and regional policies directly targeting the creation of good jobs; (iii) innovation policies that incentivize labour-friendly technologies; (iv) international economic policies that facilitate the maintenance of high domestic labour/social standards. These elements are connected both by their objective—expanding the number of good jobs—and by a new approach to regulation that is collaborative and iterative rather than top-down and prescriptive. We emphasize the importance of new institutional arrangements that enable strategic long-term information exchange and cooperation between governments and firms.

The global political-economic order is in flux. It is unclear what will replace the U.S-centric post-1990s “liberal” order and whether competition with China can be managed successfully. We advance a set of principles for the construction of a stable and broadly beneficial world order that does not require significant commonality in interests and values among states. In particular, we propose a “meta-regime” that presumes only minimal initial agreement among the major powers. The meta-regime is a device for structuring a conversation around the relevant issues, and facilitating either agreement or accommodation, as the case may be. It is agnostic and open-ended about the specific rules to be applied in particular issue-areas. Even where agreement proves impossible, as will often be the case, the objective of the meta-regime is to enhance communication among the parties and clarify the reasons for the disagreement, and to incentivize states to avoid inflicting unnecessary harm on others as they act autonomously. Participating in this meta-regime would impose few constraints on states that want to maintain their freedom of action. Yet in favorable circumstances, it could facilitate significant cooperation. It could also encourage increased cooperation over time even among adversaries, as participation in the meta-regime builds trust between them. We illustrate the practical implications of the meta-regime by applying it to U.S.-China digital competition, U.S.-Iran relations, human rights, and global migration.

Recent growth accelerations in Africa are characterized by increasing productivity in agriculture, a declining share of the labor force employed in agriculture and declining productivity in modern sectors such as manufacturing. To shed light on this puzzle, we disaggregate firms in the manufacturing sector by size using two newly created panels of manufacturing firms, one for Tanzania covering 2008-2016 and one for Ethiopia covering 1996-2017. Our analysis reveals a dichotomy between larger firms that exhibit superior productivity performance but do not expand employment much, and small firms that absorb employment but do not experience any productivity growth. We suggest the poor employment performance of large firms is related to use of capital-intensive techniques associated with global trends in technology.

We study preferences for government action in response to layoffs resulting from different types of labourmarket shocks. We consider: technological change, a demand shift, bad management and three kinds of international outsourcing. Support for government intervention rises sharply in response to shocks and is heavily biased towards trade protection. Trade shocks generate more demand for protectionism and, among trade shocks, outsourcing to a developing country elicits greater demand for protectionism. The ‘bad management’ shock is the only scenario that induces a desired increase in compensatory transfers. Trump supporters are more protectionist than Clinton supporters, but preferences seem easy to manipulate: Clinton supporters primed with trade shocks are as protectionist as baseline Trump voters. Highlighting labour abuses in the exporting country increases the demand for trade protection by Clinton supporters but not Trump supporters.