The Simple Analytics of Elite Behaviour under Limited State Capacity

Fraņois Bourguignon, Thierry Verdier

Research output: Chapter in Book/Report/Conference proceedingChapter


This chapter discusses the issue of taxation and redistribution in economies dominated by elites with limited state capacity. Within a simple aggregate framework, we discuss the political economy incentives of elites to tax, redistribute, and increase state capacity. In particular, the analysis highlights the role of complementarities or substitutability in the production process between the factors controlled by the elite and other social groups, and shows the existence of natural increasing returns for elites to increase state capacity. The chapter also discusses how the incentives for state capacity building are affected by political threats of power shifting.

Original languageEnglish (US)
Title of host publicationThe Role of Elites in Economic Development
PublisherOxford University Press
ISBN (Electronic)9780191749032
ISBN (Print)9780199659036
StatePublished - Jan 24 2013


  • Elites
  • Political economy
  • Redistribution
  • State capacity-building

ASJC Scopus subject areas

  • General Economics, Econometrics and Finance


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