Cultural values and beliefs have an impact on social and economic development, but the interplay between culture and political institutions is still not well understood. This column examines the effect of trust on political stability in democratic and non-democratic regimes, specifically in the face of severe economic downturns. It finds that democratic regimes with high levels of trust are much less likely to experience leader turnover than low-trust countries, while there is no effect among non-democracies, and that countries with higher levels of trust experience faster economic growth in the years immediately following a recession.
Nathan Nunn, Nancy Qian, Jaya Wen, 29 September 2018
Paul Krugman, 09 October 2017
How did academic macroeconomics evolve? In this video, Paul Krugman explains how macroeconomic models fail to completely explain the events of the last decade. This video was recorded at the "10 years after the crisis" conference held in London, on 22 September 2017.
Natalie Chen, Liam Graham, Andrew Oswald, 17 August 2008
Higher energy prices are likely to reduce profitability of industry and thus could bring about an economic downturn. The authors of DP 6937 experiment with terrorist acts as an instrumental variable, in order to examine the relationship between the price of oil, terrorist incidents and the resultant effects on profitability and margins.
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