After evening out all the benefits and costs, the overall optimal level of democracy is about 3.2, on a scale of 1 to 7. On average, fully dictatorial countries have a conditioned growth rate of ¨C1.113 percent, fully democratic countries have a conditioned growth rate of 1.146 while countries...

This paper asks an old but still unsettled question: what makes China China? Existing theories rely on either class, or market or cultural causes to explain the economic stagnation of imperial China. While accepting the basic proposition of the class based analysis, this paper adds a new...

Developing and transitional economies usually experience high levels of income polarization during the period of transition and rapid economic growth. Understanding and quantifying its effects on the economy is important to developmental strategies. In this paper, we study the effect of income...

In this paper, we build a simple model to explain the choice of migration method and the root causes of international human trafficking (IHT). Our analyses result in several implications on the problems related to IHT. First, IHT is driven by poverty and international productivity/living quality...

In this paper, we formulate a political system that can satisfy certain desirable characteristics that include democratic participation, serving for universal interest, public sector efficiency, and sustainable by incentive compatibility and virtuous cycles. The system comprises a set of rules...

Despite decades of experience and research, the effects of minimum wage legislation (MWL) on long-run economic performance have rarely been studied since Stigler’s (1946) classic exposition about the shortcomings of MWL. In this study, we use a novel method to estimate the magnitude and...

The shadow price of a productive good is equal to its money price less its marginal product. As more of the good is consumed, its shadow price rises because of diminishing productivity and the consumer's full income also rises because the marginal product is positive. The direction of the...

This paper uses a new approach to estimate how government expenditures affect the growth rate of real GDP. They affect the growth rate through three channels - total factor productivity, investment and aggregate demand. We find that apart from government investment, all government expenditures...