RENT SEEKING AND DEMOCRACY: EMPIRICAL EVIDENCE FOR URUGUAY |
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| Authors: | CÉ SAR CALDERÓ N,ALBERTO CHONG |
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| Affiliation: | Calderón:;The World Bank, 1818 H Street, NW, Washington, DC 20433. Phone 202-458-7214, E-mail Chong:;Research Department, Stop B-900, Inter-American Development Bank, 1300 New York Avenue, NW, Washington, DC 20577. Phone (202) 623-1536, Fax (202) 623-2481, E-mail |
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| Abstract: | We provide evidence for Granger causality between rent-seeking behavior and democracy in Uruguay, where both rent-seeking behavior and political shifts have varied widely in the past 80 yr but ethnolinguistic heterogeneity and inequality have remained low. This helps identify "pure" interactions and their link with rent-seeking outcomes. The presence and duration of democracy appear to have been conducive to a decrease in rent seeking, although the reduction in rent seeking does not appear to have had a bearing on the quality of democratic regime. While the duration of democratic regime may impact rent-seeking behavior, rent seeking also displays a Granger causality to democratic duration. ( JEL O10, O1) |
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