The market for protection and the origin of the state
By Kai A. Konrad, Stergios Skaperdas. Economic Theory, 2010
130 citations recorded by the source corpus.
We examine a stark setting in which security or protection can be provided by self-governing groups or by for-profit entrepreneurs (kings, kleptocrats, or mafia dons). Although self-governance is best for the population, it faces problems of long-term viability. Typically, in providing security, the equilibrium market structure involves competing lords, a condition that leads to a tragedy of coercion: all the savings from the provision of collective protection are dissipated and welfare can be as low as, or even lower than, in the absence of the state. Thus, we explain the tendency towards autocracy both in history, before the appearance of modern representative governance, and in many low-income countries in modern times.
Subfields: Demography, Economics and Econometrics
View Paper: https://www.semanticscholar.org/paper/ee124236fc306bf1a34e9999e45b3d5b6c2e1213
How researchers see this paper
The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.
In Demography
In Economics and Econometrics
Citations in the corpus
- Poor institutions, rich mines: resource curse and the origins of the Sicilian mafia (2012, background): “Similarly, the literature on organized crime (Gambetta, 1993; Konrad and Skaperdas, 2012) has argued that the combination of weak institutions and resource abundance can be conducive to the emergence of mafia-type organizations which can have profound and long-lasting effect on a country’s economic…”