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.
2010
institutional environment; transition economies; rent-seeking
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/20.500.11770/128576
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