Calendrier du 26 novembre 2019
PSI-PSE (Petit Séminaire Informel de la Paris School of Economics) Seminar
Du 26/11/2019 de 17:00 à 18:00
LETROUIT Lucie (Université Gustave Eiffel)
Why can't we be friends? An evolutionary approach to the emergence of social hierarchies
Economic behaviors are deeply influenced by social norms and, in particular, ethno-cultural hierarchies. However, the emergence of such hierarchies through individual interactions and the complex interplay of interests between multiple ethno-cultural groups have not been properly analyzed in the existing literature. To address this gap, I propose, in this paper, a three-group (one majority and two minorities) evolutionary game model of the emergence of social hierarchies in a multi-cultural country context. I show that (1) social hierarchy views tend to be shared by most individuals within and across groups, (2) transitions towards new hierarchy views may be achieved through inter-group alliances emerging at the level of group members rather than group leaders, (3) egalitarian hierarchies are very unlikely to persist in the long run, (4) multi-level ethno-cultural hierarchies play a crucial role in preserving the majority group's domination and avoiding the emergence of an egalitarian hierarchy, (5) the arrival of a new minority in a society is often beneficial to the old minority in the long term, either due to a direct improvement in status or to an indirect improvement in self-identity caused by the recognition of the new minority, and (6) the speed of cultural convergence between groups depends on the prevailing social hierarchies and on society's cohesiveness.
Applied Economics Lunch Seminar
Du 26/11/2019 de 12:30 à 13:30
Salle R2-01, Campus Jourdan, 48 boulevard Jourdan, 75014 Paris
BAU Natalie (UCLA)
Misallocation and Capital Market Integration: Evidence from India
écrit avec Adrien Matray (Princeton)
Using the staggered liberalization of access to foreign capital across highly disaggregated Indian industries, we show that capital misallocation is an important contributor to low aggregate productivity. The natural policy experiment allows us to credibly identify changes in firms’ input wedges, addressing major challenges in the measurement of misallocation. For domestic firms with initially high marginal revenue products of capital (MRPK), liberalization increased revenues by 18%, physical capital by 60%, wage bills by 26%, and reduced the marginal revenue product of capital by 43%. There were no effects on firms with low MRPK. The effects of liberalization are largest in areas with less developed local banking sectors, indicating that foreign investors may substitute for an efficient banking sector. Finally, we develop a new method to use natural experiments to estimate the lower bound effect of changes in misallocation on manufacturing productivity and conclude that the liberalization increased the aggregate productivity of the Indian manufacturing sector by at least 7.6%.