This paper develops a dynamic framework to analyze the political sustainability of economic reforms in developing countries. First, we demonstrate that economic reforms that are proceeding successfully may run into a political impasse, with the reform's initial success having a negative impact...

We study the provision of public goods. Different public goods can be bundled provided there is enough capacity, i.e. resources to pay for all the public goods in the bundle. The analysis focuses on the all-or-nothing-mechanism: Expand provision as much as resource feasible if no one vetoes -...

Climate action requires significant public- and private sector investment to achieve meaningful reductions in carbon emissions. This paper documents that large-scale austerity, coupled with barriers to flows of data and a lack of (digital) skills in (local) government, may have been a...

Formal conceptions of state capacity have mostly focused on indirect measures of state capacity – by, for instance, using the state's fiscal or extractive capacity as a proxy for its overall capacity. Yet, this input or extractive view of state capacity falls short, especially since...

This study analyzes how state capacity shapes the local impact of national policies by exploiting a quasi-natural experiment in the regional expansion of the state. It uses the local discontinuity created by the boundary of the largest peasant rebellion in 18th century Russia where the state...

If people understand that some macroeconomic policies are unsustainable, why would they vote for them in the first place? We develop a political economy theory of the endogenous emergence of fiscal crises, based on the idea that the adjustment mechanism to a crisis favors some social groups,...

This paper examines how managers at the top of a public institution, central bank executives, allocate their working time. Using detailed information from personal diaries of the six members of the European Central Bank’s Executive Board over a period of two years, we codify and analyze more...

Should the European Union grant state aid through an institution like the European Investment bank? This paper evaluates the efficiency of different measures for granting state aid. We use a theoretical model with firms that differ in their creditworthiness and compare different types of...