This paper describes the correlations between inequality and the growth rates in cross-country data. Using non-parametric methods, we show that the growth rate is an inverted U-shaped function of net changes in inequality: changes in inequality (in any direction) are associated with reduced...

Participation of beneficiaries in the monitoring of public services is increasingly seen as key to improving their efficiency. In India, the current government flagship program on universal primary education organizes community members, specifically locally elected leaders and parents of...

This paper develops the stochastic theory of distribution with a dynamic model that focuses on the role of incomplete insurance in generating inequality. Unlike previous work, the authors' approach takes explicit account of the reason for market incompleteness in modeling agents behavior; in...

This paper models economic development as a process of institutional transformation by focusing on the interplay between agents' occupational decisions and the distribution of wealth. Becau se of capital-market imperfections, poor agents choose working for a wa ge over self-employment and...

This paper tries to explain why government bureaucracies are often associated with red tape, corruption, and lack of incentives. The paper identifies two specific ingredients that together can provide an explanation: the fact that governments often act precisely in situations where markets fail...

The author analyzes a sequential decision model in which each decisionmaker looks at the decisions made by previous decisionmakers in taking her own decision. This is rational for her because these other decisionmakers may have some information that is important for her. The author then shows...

This paper studies a class of information transmission processes called rumors. The distinctive features of these processes are that the information transmission takes place in such a way that the recipient does not quite know whether or not to believe the information and that the probability...

Economists now appreciate that resource allocation in less economically developed economies is profoundly influenced by nonfirm economic institutions. However, the authors' theories of nonfirm institutions often suggest different answers to many questions, including those of policy. This paper...