Since efforts by industrial countries to increase the amount of foreign aid they provide have been on the rise recently, it is important to understand the determinants involved. This paper examines the factors affecting support for foreign aid among voters in donor countries. The theoretical...

This paper presents theory and evidence on the relationship between inequality and institutional quality. We propose a model in which the two dynamically reinforce each other and set out to test this relationship with a broad array of institutional measures. We establish double causality between...

This paper presents theory and evidence on the determinants of the size of the informal sector. We propose a simple theoretical model in which the informal sector`s size is negatively related to institutional quality and positively related to income inequality. These predictions are then...

The aftermath of the recent economic crisis saw the largest U.S. government bailout of corporate entities ever. While the bailout was carried out with the explicit goal of restoring stability, it aroused much controversy and public criticism based on moral hazard concerns as well as the...

The diversity of social interaction within economic communities affects productivity and growth, and is itself shaped by economic conditions. These reciprocal effects raise the possibility of multiple equilibria, of setting a socially polarized economy stagnating in poverty on a new path of...

Minorities, such as ethnic and immigration groups, have often been subject to exclusion through labor market discrimination, residential and employment segregation policies, business ownership regulations, restrictions on political participation, access to public services and more. This paper...

With efforts across the industrial countries to increase the amount of foreign aid mounting, it is important to understand its determinants. This paper examines the factors affecting the support for foreign aid among voters in donor countries. A simple theoretical model, which considers an...

Using a rich individual-level dataset on secondary public schools in Israel, we find strong evidence for discontinuities in the relationship between enrollment and household characteristics at cutoff points induced by a maximum class size rule. Our findings extend existing work that documents...

We construct a simple model of compulsory schooling in which legislation and compliance are endogenously determined by individuals disciplined by social norms, optimizing their voting decisions and the school attendance of their children. The model provides a formal framework for interpreting...

This paper revisits the effects of a country's institutional framework on individual firms' behavior, in particular focusing on their propensity to comply with legal rules. The theoretical model presented here suggests that these effects may be of paramount significance-contrary to the recently...