Harvard University Department of Economics
Spring 2016
Econ 970: Sophomore Tutorial
Time: Monday/Wednesday 4:00-5:30pm
Location: TBA
Course Website: TBA
Instructor: Henrik Sigstad
[email protected]
Office Hours: by appointment
Anarchy, monarchy, and democracy
Course description
How can corrupt and autocratic regimes evolve into stable democracies? Why do some states
suffer from civil war and chaos? What prevents the United States from sliding back into dictatorship? How can the powerful be made subject to law? And how can we design international
institutions to prevent the next world war? In this class we will try our best to answer these
and other fundamental questions about the organization of human societies. We will discuss
how leaderless societies can develop norms and simple legal institutions, the logic behind violent
conflict, how states arise, how tyrannical leaders can be made accountable, and how democracy
can emerge and be sustained. An important aim of the class is to teach you to think scientifically. We will focus on the interplay between theory and empirics, relating mathematical models
of political institutions to cutting edge empirical research. The tutorial will focus on research
done by economists. However, you will be encouraged to read research from the other social
sciences such as law, political science, anthropology and sociology in order to gain a deeper
understanding and to be able to develop an interesting research paper.
Prerequisites
Courses in intermediate microeconomics and introductory statistics are required. Having taken
econometrics or taking econometrics concurrently is recommended.
Course Requirements
Sign up for office hours. You are required to sign up for office hours with me one time within
the first three weeks of the class (in order for me to get to know you!). Be prepared to talk
about your interests and what you hope to get out of the course. You are also required to sign
up for office hours in order to discuss your idea for the final project before March 17.
Class Participation (10%). Attendance is mandatory since class discussion is an essential component of the class. Students should read all the readings before class and be ready to actively
participate in the class discussion. Each student needs to prepare at least one comment about
each reading before each class. Everybody is required to sign up to lead the discussion of at
least two papers during the semester.
Response Papers (10%, min. 100 words each). Students should write one response paper discussing one or more of a class’ assigned readings each week. Your response papers must be sent
to me by 5:00 pm the day before a paper is assigned (so if the paper is assigned for Wednesday,
you should send your response paper by 5:00 pm on Tuesday). You may choose for which class
each week to write the response paper. Late papers will not be accepted.
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Research proposals (20%, 4-6 pages). You will be asked to write two research proposals related
to a freely elected topic discussed in class. The aim of this exercise is to give you training in
how to apply economic thinking to a specific case. It will allow you to go deeper into a topic
from class that you are interested in, learn how to think like an economist, and will be valuable
for generating ideas for the final project. Feel free to use one of the research proposals as a basis
for your final project.
Prospectus (10%, 4-6 pages). Your prospectus is a roadmap for your final research paper. It
should motivate and describe your theoretical hypothesis, review related work, and discuss what
data and empirical strategy you will use. You are required to schedule to meet with me at least
once to discuss your research idea before you turn in the prospectus.
Research Paper (40%, 15-18 pages not including tables and figures). You will write a research
paper on a topic of your choice. You should pose a hypothesis, discuss how it relates to the
literature, empirically test it, and present your findings. You may also do a purely theoretical
work based on a case study. Start thinking about your research paper topic early and talk to
me often.
Stata Problem Sets (10%). You will attend the mandatory Stata tutorials held by XXX (the
Stata tutor) at (date, time, location TBD) and complete and turn in the four problem sets to
me, including log and do files.
Notes on Response Papers. In your response papers you should answer the following questions:
1. What is the main take-away of the paper?
2. For theoretical papers:
a) Do you think the model is a good model of reality? Why/why not?
3. For empirical papers:
a) Do you believe in the empirical strategy? Why/why not?
b) How do the results relate to theory?
Due Dates
2/17, 3/3, 3/24, 4/7: Due dates for stata problem sets 1-4, respectively.
2/24, 3/17: Research proposal 1 and 2 due by email
3/31: Prospectus due by e-mail
Monday, May 1 at 5:00pm: Final Paper due by e-mail (Hard deadline set by the course)
Course Policies
Attendance. Attendance is mandatory. If you absolutely cannot make it, email me beforehand.
Correspondence. I aim to respond to emails within 24 hours. Keep this in mind around assignment due dates and note that I may be slower on weekends. Please include Ec 970 in the subject
line for all emails so they don’t get lost in my inbox.
Cold calling. Each student will be asked to give one comment on each paper in every class.
There will be no cold-calling apart from that.
Extensions. Please discuss extensions with me in advance. Be aware that you cannot get an
extension on the final paper.
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Plagiarism. If you plagiarize, you will fail the course. See the Harvard College Handbook for
Students for details.
Working with Others. Students are free (and encouraged) to discuss problem sets and their
papers with one another. However, you must hand in your own (unique) code and written work
in all cases.
Expectations for Readings. Most of the readings assigned in this course were published in
top five economics journals. You are not expected to be able to reproduce the mathematical
arguments on your own. When reading, focus on understanding the key theoretical insights and
the empirical strategy.
Laptops. The use of laptops during class would not be permitted.
Academic honesty
Discussing ideas and work-in-progress with others is an important and desirable part of the
research process, but in the end, a students assignment must be his or her own effort, written
by the student, and ultimately based on his or her own thinking. All written assignments must
use appropriate citation practices. For questions about Harvards stance on academic honesty,
consult the Academic Information section in the Harvard College Handbook for Students.
Schedule and Reading List
The required reading for each class is in the “Required” section. Other readings are for people
who are particularly interested in the topic. The readings under “Cases” are mostly qualitative
papers from the other social sciences and can serve as basis for the two research proposal
assignments. The reading list is tentative and subject to change as we progress through the
term. Changes to the required readings will be announced in class and on Canvas at least a
week in advance.
Class 1: Introduction
Required
Daron Acemoglu, Simon Johnson, and James A. Robinson (2005). “Institutions as a Fundamental Cause of Long-Run Growth”. Handbook of Economic Growth. Vol. 1. Chap. 6, pp. 385–
472
Counter-argument
Edward L. Glaeser, Rafael La Porta, et al. (2004). “Do institutions cause growth?” Journal of
Economic Growth 9.3, pp. 271–303
Books
Daron Acemoglu and James A. Robinson (2012). Why Nations Fail. Crown Publishers
Douglass C North and Robert P Thomas (1973). The Rise of the Western World: A New Economic History*. Cambridge University Press
Douglass C North (1991). Institutions, Institutional Change and Economic Performance*. Cambridge University Press
Douglass C North, John Joseph Wallis, and Barry Weingast (2009). Violence and Social Orders:
A Conceptual Framework for Interpreting Recorded Human History*. Cambridge University
Press
Avinash K. Dixit (2004). Lawlessness and Economics*. Princeton University Press
Masahiko Aoki (2001). Toward a comparative institutional analysis. MIT Press
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ANARCHY
Class 2: Anarchy
Required
Robert Axelrod (1984). The Evolution of Cooperation. Basic Books (only Chapter 1)
David Skarbek (2012). “Prison gangs, norms, and organizations”. Journal of Economic Behavior
and Organization 82.1, pp. 96–109
Benjamin Powell, Ryan Ford, and Alex Nowrasteh (2008). “Somalia after state collapse: Chaos
or improvement?” Journal of Economic Behavior and Organization 67.3, pp. 657–670
Survey
Benjamin Powell and Edward P. Stringham (2009). “Public choice and the economic analysis
of anarchy: A survey”. Public Choice 140.3-4, pp. 503–538
Cases
Frans de Waal (1998). Chimpanzee Politics: Power and Sex Among Apes*. John Hopkins
University Press
Class 3: Feuds
Required
Handout on the repeated prisoner’s dilemma
Xavier Gabaix and David Laibson (2011). “The Seven Properties of Good Models”. The
Foundations of Positive and Normative Economics: A Hand Book
Pascual Restrepo (2015). “The Mounties and the Origins of Peace in the Canadian Prairies”.
Working paper
Cases
Christopher Boehm (1987). Blood Revenge: The Enactment and Management of Conflict in
Montenegro and Other Tribal Societies*. University of Pennsylvania Press
Jon Elster (1990). “Norms of Revenge”. Ethics 100.4, pp. 862–885
Class 4: Conflict I
Required
James Fearon (1995). “Rationalist Explanations for War”. International Organization 49.3,
pp. 379–414
Samuel R. Williamson (1988). “The Origins of World War I”. The Journal of Interdisciplinary
History 18.4, pp. 795–818
Surveys
Christopher Blattman and Edward Miguel (2010). “Civil War”. Journal of Economic Literature
48.1, pp. 1–49
Michelle R. Garfinkel and Stergios Skaperdas (2007). “Economics of Conflict: An Overview”.
Handbook of Defense Economics 2, pp. 649–709
Class 5: Conflict II
Required
P Collier and A Hoeffler (2004). “Greed and grievance in civil war”. Oxford Economic Papers
56.4, pp. 563–595
Oeindrila Dube and Juan Vargas (2013). “Commodity Price Shocks and Civil Conflict: Evidence
from Colombia”. Review of Economic Studies 80.4, pp. 1384–1421
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Class 6: Norms I
Richard A Posner and Eric B Rasmusen (1999). “Creating and enforcing norms, with special
reference to sanctions”. International Review of Law and Economics 19.3, pp. 369–382
Michihiro Kandori (1992). “Social Norms and Community Enforcement”. Review of Economic
Studies 59.1, pp. 63–80
Bruce L. Benson and Zafar R. Siddiqui (2014). “Pashtunwali-Law for the lawless, defense for
the stateless”. International Review of Law and Economics 37, pp. 108–120
Empirics
Avner Greif (1993). “Contract Enforceability and Economic Institutions in Early Trade: The
Maghribi Traders’ Coalition”. American Economic Review 83.3, pp. 525–548
Joseph Henrich et al. (2006). “Costly punishment across human societies”. Science 312.5781,
pp. 1767–70
Cases
Robert Sugden (1989). “Spontaneous Order”. Journal of Economic Perspectives 3.4, pp. 85–97
Richard H. McAdams (2000). “A Focal Point Theory of Expressive Law”. Virginia Law Review
85.2, pp. 247–328
Herbert Gintis (2007). “The evolution of private property”. Journal of Economic Behavior and
Organization 64.1, pp. 1–16
Class 7: Norms II
Required
Roger B. Myerson (2004). “Justice, Institutions, and Multiple Equilibria”. Chicago Journal of
International Law 5.1, p. 91
Moshe Hoffman and Erez Yoeli (2016). “Why norms are categorical”. Working paper
Class 8: Norms III
Required
Raymond Fisman and Edward Miguel (2007). “Corruption, Norms, and Legal Enforcement:
Evidence from Diplomatic Parking Tickets”. Journal of Political Economy 115.6, pp. 1020–
1048
Ritva Reinikka and Jakob Svensson (2011). “The power of information in public services: Evidence from education in Uganda”. Journal of Public Economics 95.7, pp. 956–966
Emilie M. Hafner-Burton (2012). “International Regimes for Human Rights”. Annual Review
of Political Science 15.1, pp. 265–286
Class 9: Courts I
Required
G. K. Hadfield and B. R. Weingast (2012). “What Is Law? A Coordination Model of the
Characteristics of Legal Order”. Journal of Legal Analysis 4.2, pp. 471–514
Paul R Milgrom, Douglass C North, and Barry R Weingast (1990). “The Role of Institutions in
the Revival of Trade: the Law Merchant, Private Judges, and the Champagne Fairs”. Economics
& Politics 2.1, pp. 1–23
Cases
Lisa Bernstein (1992). “Opting out the legal system: Extralegal contractual relations in the
diamond industry”. The Journal of Legal Studies 21.1, pp. 115–157
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David Friedman (1979). “Private Creation and Enforcement of Law: A Historical Case”. Journal
of Legal Studies 8, p. 399
Class 10: Courts II
Required
Jonathan R. Hay and Andrei Shleifer (1998). “Private Enforcement of Public Laws: A Theory
of Legal Reform”. American Economic Review 88.2, pp. 398–403
Rebecca Bill Chavez (2003). “The Construction of the Rule of Law in Argentina A Tale of Two
Provinces”. Comparative Politics 35.4, pp. 417–437
Class 11: Courts III
Required
Article about the UN (link)
Ilyana Kuziemko and Eric Werker (2006). “How Much Is a Seat on the Security Council Worth?
Foreign Aid and Bribery at the United Nations”. Journal of Political Economy 114.5, pp. 905–
930
MONARCHY
Class 12: State formation I
Required
Mancur Olson (1993). “Dictatorship, Democracy, and Development”. American Political Science Review 87.3, pp. 567–576
Jennifer J Adams and Jesenia M Pizarro (2009). “Ms-13: a Gang Profile”. Journal of Gang
Research 16.4, pp. 1–12
Raul Sanchez de la Sierra (2014). “On the Origin of States: Stationary Bandits and Taxation
in Eastern Congo”. Job Market Paper
Theory
Charles Tilly (1985). “War Making and State Making as Organized Crime”. Bringing The State
Back In. Cambridge University Press, pp. 169–187
Stergios Skaperdas (1992). “Cooperation, Conflict, and Power in the Absence of Property
Rights”. American Economic Review 82.4, pp. 720–739
Cases
Diego Gambetta (1993). The Sicilian Mafia: The Business of Private Protection*. Harvard
University Press
Curtis J. Milhaupt and Mark D. West (2000). “The Dark Side of Private Ordering: An Institutional and Empirical Analysis of Organized Crime”. University of Chicago Law Review 67.1,
pp. 41–98
Class 13: State formation II
Required
Jack Hirshleifer (1995). “Anarchy and its Breakdown”. Journal of Political Economy 103.1,
p. 26
Joram Mayshar et al. (2015). “Cereals, Appropriability and Hierarchy”. Working paper
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Class 14: Checks and balances I
Required
Barry R. Weingast (1997). “The Political Foundations of Democracy and the Rule of Law”.
The American Political Science Review 91.2, pp. 245–263
Gary King, Jennifer Pan, and Margaret Roberts (2013). “How Censorship in China Allows
Government Criticism but Silences Collective Expression”. American Political Science Review
107.917, pp. 326–343
Adam S. Chilton and Mila Versteeg (2016). “Do Constitutional Rights Make a Difference?”
American Journal of Political Science 60.3, pp. 575–589
Theory
Leonid Hurwicz (2008). “But Who Will Guard the Guardians?” American Economic Review
98.3, pp. 577–585
Torsten Persson, Gerard Roland, and Guido Tabellini (1997). “Separation of powers and political accountability”. The Quarterly Journal of Economics 112.4, pp. 1163–1202
Carles Boix and Milan W. Svolik (2013). “The Foundations of Limited Authoritarian Government: Institutions, Commitment, and Power-Sharing in Dictatorships”. Journal of Politics
75.02, pp. 300–316
Rui J P De Figueiredo and Barry R. Weingast (2005). “Self-enforcing federalism”. Journal of
Law, Economics, and Organization 21.1, pp. 103–135
Gillian K Hadfield and Barry R Weingast (2013). “Constitutions as Coordinating Devices”.
Working paper
Cases
Timothy Frye (2004). “Credible commitment and property rights: Evidence from Russia”.
American Political Science Review 98.3, pp. 453–466
Class 15: Checks and balances II
Required
Roger B. Myerson (2008). “The Autocrat’s Credibility Problem and Foundations of the Constitutional State”. American Political Science Review 102.1, pp. 125–139
Douglass C. North and Barry R. Weingast (1989). “Constitution and Commitment: the Evolution of Institutions Governing Public Choice in Seventeenth-Century England”. Journal of
Economic History 49.4, pp. 1–19
Peter Leeson and David Skarbek (2010). “Criminal constitutions”. Global Crime 11.3, pp. 279–
297
DEMOCRACY
Class 16: Democratization I
Required
Daron Acemoglu and James A Robinson (2000). “Why Did the West Extend the Franchise?
Democracy, Inequality , and Growth in Historical Perspective”. Quarterly Journal of Economics
115.4, pp. 1167–1199
Toke S. Aidt and Raphaël Franck (2015). “Democratization Under the Threat of Revolution:
Evidence From the Great Reform Act of 1832”. Econometrica 83.2, pp. 505–547
Theory
Daron Acemoglu and James A Robinson (2009). Economic Origins of Dictatorship and Democracy. Cambridge University Press
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Class 17: Democratization II
Required
Edward L. Glaeser, Giacomo A M Ponzetto, and Andrei Shleifer (2007). “Why does democracy
need education?” Journal of Economic Growth 12.2, pp. 77–99
Rachel M. Gisselquist (2008). “Democratic Transition and Democratic Survival in Benin”.
Democratization 15.4, pp. 789–814
Cases
Seymour Martin Lipset (1959). “Some Social Requisites of Democracy: Economic Development
and Political Legitimacy”. American Political Science Review 53.01, pp. 69–105
Class 18: Self-enforcing democracy
Required
James D. Fearon (2011). “Self-enforcing democracy”. Quarterly Journal of Economics 126.4,
pp. 1661–1708
S. Mittal and B. R. Weingast (2011). “Self-Enforcing Constitutions: With an Application to
Democratic Stability In America’s First Century”. Journal of Law, Economics, and Organization 29.2, pp. 278–302
Blog post by Roger Myerson (link)
Class 19: Democratic capital
Required
Paola Giuliano and Nathan Nunn (2013). “The Transmission of Democracy: From the Village
to the Nation-State”. Working paper
Macartan Humphreys, Raul Sanchez de la Sierra, and Peter Van der Windt (2015). “Social
Engineering in the Tropics: A Grassroots Democratization Experiment in the Congo”. Working
paper
Theory
Torsten Persson and Guido Tabellini (2009). “Democratic capital: the nexus of political and
economic change”. American Economic Journal: Macroeconomics 1.2, pp. 88–126
Class 20: Agency
Required
Claudio Ferraz and Frederico Finan (2011). “Electoral Accountability and Corruption: Evidence
from the Audits in Local Governments”. American Economic Review 101.4, pp. 1274–1311
Theory
Robert J Barro (1973). “The Control of Politicians: An Economic Model”. Public Choice 14,
pp. 19–42
John A. Ferejohn (1986). “Incumbent Performance and Electoral Control”. Public Choice 14.2,
pp. 395–433
Chris Bidner and Patrick Francois (2013). “The Emergence of Political Accountability”. Quarterly Journal of Economics, pp. 1–41
Class 21: Clientelism
Required
Roger B Myerson (1991). “Effectiveness of Electoral Systems for Reducing Government Cor-
8
ruption: A Game-Theoretic Analysis”. Games and Economic Behavior 5.1, pp. 118–132
Patrick Francois, Siwan Anderson, and Ashok Kotwal (2015). “Clientelism in Indian Villages”.
American Economic Review 105.6, pp. 1780–1816
Theory
Gerard Padro-i-Miquel (2007). “The Control of Politicians in Divided Societies: The Politics of
Fear”. Review of Economic Studies 74.4, pp. 1259–1274
Empirics
Thomas Fujiwara and Leonard Wantchekon (2013). “Can Informed Public Deliberation Overcome Clientelism?” American Economic Journal: Applied Economics 5.4, pp. 241–255
Robin Burgess et al. (2015). “The Value of Democracy: Evidence from Road Building in Kenya”.
American Economic Review 105.6, pp. 1817–1851
Cases
Thomas Guterbock (1980). Machine Politics in Transition: Party and Community in Chicago*.
University of Chicago Press
Ayokunle Olumuyiwa Omobowale and Akinpelu Olanrewaju Olutayo (2007). “Chief Lamidi
Adedibu and patronage politics in Nigeria”. The Journal of Modern African Studies 45.3,
pp. 425–446
MEDIA
Class 22: The effect of Media
Required
Stefano DellaVigna and Ethan Kaplan (2007). “The Fox News effect: Media bias and voting”.
Quarterly Journal of Economics 122.3, pp. 1187–1234
Maja Adena et al. (2015). “Radio and the rise of the Nazis in prewar Germany”. Quarterly
Journal of Economics, pp. 1885–1939
Empirics
Matthew Gentzkow, Jesse M Shapiro, and Michael Sinkinson (2011). “The Effect of Newspaper
Entry and Exit on Electoral Politics”. American Economic Review 101.December, pp. 1–13
David Yanagizawa-drott (2014). “Propaganda and Conflict: Evidence from the Rwandan Genocide”. Quarterly Journal of Economics 129.4, pp. 1947–1994
Class 23: Press freedom
Required
Timothy Besley and Andrea Prat (2006). “Handcuffs for the Grabbing Hand? Media Capture
and Government Accountability”. American Economic Review 96, pp. 720–736
John McMillan and Pablo Zoido (2004). “How to Subvert Democracy: Montesinos in Peru”.
Journal of Economic Perspectives 18.4, pp. 69–92
Matthew Gentzkow, Edward L Glaeser, and Claudia Goldin (2004). “The Rise of the Fourth
Estate: How Newspapers Became Informative and Why it Mattered”. NBER Working Paper
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