The model we develop analyses how the state of an institutional environment influences resources allocation in a transition economy. We capture the interaction between politicians who influence firms’ decisions regarding resources allocation and managers, introducing a parameter which measures the strength of institutions. The results of our model confirm that building up strong institutions in a transition economy can play a central role in privatisation and restructuring processes and motivate agents to agree on a better resources allocation.
Politicians, firms and the state of institutional environment
INFANTE, Davide;SMIRNOVA, JANNA
2010-01-01
Abstract
The model we develop analyses how the state of an institutional environment influences resources allocation in a transition economy. We capture the interaction between politicians who influence firms’ decisions regarding resources allocation and managers, introducing a parameter which measures the strength of institutions. The results of our model confirm that building up strong institutions in a transition economy can play a central role in privatisation and restructuring processes and motivate agents to agree on a better resources allocation.File in questo prodotto:
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