There are good reasons to think that social networks can reduce barriers to the exchange of production factors. Using data from 51 villages in Gambia, this column examines whether transfers of land between rural households improve efficiency, and whether social networks help or hinder such transfers. The results suggest that social ties may indeed be able to offset the negative impact of a limited or non-existing institutional framework.
Ulrik Beck, Benedikte Bjerge, Marcel Fafchamps, 06 February 2016
Mark Harrison, 15 January 2014
Democracy often seems bureaucratic with high ‘transaction costs’, while autocracies seem to get things done at lower cost. This column discusses historical research that refutes this. It finds empirical support from Soviet archives for a political security/usability tradeoff. Regimes that are secure from public scrutiny tend to be more costly to operate.
Steven Medema, 18 September 2013
Ronald Coase’s contributions to economics were much broader than most economists recognise. His work was characterised by a rejection of ‘blackboard economics’ in favour of detailed case studies and a comparative analysis of real-world institutions. This column argues that the ‘Coase theorem’ as commonly understood is in fact antithetical to Coase’s approach to economics.