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Are command systems that rest on coercion inherently unstable, and did the Soviet economy collapse for this reason? Until it collapsed, the Soviet economy did not appear unstable. Why, then, did it collapse? A game between a dictator and a producer shows that a high level of coercion may yield a...
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is subject to multiplier effects. We build upon the static case, where all agents receive a private signal about an … in the second period and learn about the public signal through a multiplier signal. We show that in the unique … information is thus considerably lower than the static case suggests. Multiplier effects might decrease overall welfare if …
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