Can Market Failure Cause Political Failure?

Maitreesh Ghatak, Madhav Aney, Massimo Morelli, 18 August 2011

Political economists study how distortions in political access can lead to policies that lead to market failures. The authors of CEPR DP8533 examine the reverse link, mapping out how market failures could create political cleavages which can then amplify the market failure by voting for bad policies.

Vox readers can download CEPR Discussion Paper 8533 for free here. To learn more about subscribing to CEPR's Discussion Paper Series, please visit the CEPR website.

Journalists are entitled to free DP downloads on request; please contact pressoffice@cepr.org. To learn more about subscribing to CEPR's Discussion Paper Series, please visit the CEPR website.

URL: www.cepr.org/DP8533
Topics: Institutions and economics, Politics and economics, Poverty and income inequality
Tags: adverse selection, asset liquidation, market failure, occupational choice, political failure and property rights

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