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  • 标题:Excessive Public Employment and Rent-Seeking Traps
  • 本地全文:下载
  • 作者:Esteban Jaimovich ; Juan Pablo Rud
  • 期刊名称:Discussion Papers in Economics / Department of Economics, Royal Holloway
  • 出版年度:2010
  • 卷号:2010
  • 出版社:University of London
  • 摘要:We propose a model where the size of the public sector and the level of aggregate output are interconnected through the occupational choice of skilled agents, who di¤er in their degree of public-mindedness. Whenever the public sector attracts bureaucrats with low degree of public service motivation, they will use their position to rent seek by employing an excessive number of unskilled workers. This leads to an equilibrium with relatively high unskilled wages, which lowers pro.ts and deters entrepreneurship. Conversely, an equilibrium with a lean public sector and greater private economic activity arises whenever public sector motivated agents populate the state bureaucracy. These agents exert high e¤ort and employ a limited number of unskilled workers. We extend the model to show that a bloated public sector with high wages might result from the optimal voting behaviour of unskilled agents. Finally, we provide evidence documenting speci.c features of the model using cross-country and Argentinean data.
  • 关键词:Rent Seeking, Occupational Choice, Public Service Motivation, Political Economy.
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