Campante, Filipe; Do, Quoc-Anh; Guimarães, Bernardo - C.E.P.R. Discussion Papers - 2013
Motivated by a novel stylized fact -- countries with isolated capital cities display worse quality of governance -- we … ways: broader power sharing (associated with better governance) means that any rents have to be shared more broadly, hence … capital city allows the elite to appropriate a larger share of output, so the costs of better governance for the elite, in …