How does ideological polarization on non-economic matters influence the size of government? We analyze this question using a differentiated candidates framework: Two office-motivated candidates differ in their (fixed) ideological position and their production function for public goods, and...

We consider an economy where decision maker(s) do not know the true production function for a public good. By using Bayes rule they can learn from experience. We show that the economy may learn the truth, but that it may also converge to an inefficient policy where no further inference is...

Cities increasingly address climate change, e.g. by pledging city-level emission reduction targets. This is puzzling for the provision of a global public good: what are city governments' reasons for doing so, and do pledges actually translate into emission reductions? Empirical studies have...

We explore the relationship between government size and economic growth in an endogenous growth model with human capital and an unproductive capital which facilitates rent-seeking. With exogenous as well as endogenous time discounting, we find a non-monotonic relationship between the size of...

There exists a persistent disagreement in the literature over the effect of business cycles on economic growth. This paper offers a solution to this disagreement, suggesting that volatility carries a positive direct effect, but also a negative indirect effect, operating through the insurance...

We examine the effect of population size on government size for a panel of 130 countries for the period between 1970 and 2014. We show that previous analyses of the nexus between population size and government size are incorrectly specified and fail to consider the influence of cross-sectional...

We examine the effect of population size on government size for a panel of 130 countries for the period between 1970 and 2014. We show that previous analyses of the nexus between population size and government size were incorrectly specified, not accounting for cross-sectional dependence,...

We study the classical free-rider problem in public goods provision in a large economy with uncertainty about the average valuation of the public good. Individual preferences over public goods are shaped by a skill and a taste parameter. We use a mechanism design approach to solve for the...

We examine whether and how democratic procedures can achieve socially desirable public good provision in the presence of profound uncertainty about the benefits of public goods, i.e., when citizens are able to identify the distribution of benefits only if they aggregate their private...

We study the role of self-interest and social preferences in referenda. Our analysis is based on collective purchasing decisions of university students on deep-discount flat rate tickets for public transportation and culture. Individual usage data allows quantifying monetary benefits associated...