Ideas to Action:

Independent research for global prosperity

Publications

 

pritchett-aiyar-taxes-cover
August 31, 2015

Taxes: Price of Civilization or Tribute to Leviathan? - Working Paper 412

There are two dominant narratives about taxation.  In one, taxes are the “price we pay for a civilized society” (Oliver Wendell Holmes Jr.).  In this view taxes are not a necessary evil (as in the pairing of “death and taxes” as inevitable) but a positive good: more taxes buy more “civilization.” The other view is that taxes are “tribute to Leviathan”—a pure involuntary extraction from those engaged in economic production to those who control coercive power producing no reciprocal benefit.  In this view taxes are a bane of the civilized.   We consider the question of taxes as price versus tribute for contemporary India.

Lant Pritchett and Yamini Aiyar
June 10, 2015

Manufacturing or Services? An Indian Illustration of a Development Dilemma - Working Paper 409

Manufacturing has historically offered the fastest path out of poverty, but there is mounting evidence that this path may be all but closed to developing countries today. Some have suggested that services might provide a new path forward, while others have expressed skepticism about this claim and consequent pessimism over the future growth trajectories of developing countries. We contribute to debate this by using a multi-sector growth framework to establish five important criteria that any sector must exhibit in order to lead an economy to rapid, sustained, and inclusive development. 

Amrit Amirapu and Arvind Subramanian
December 7, 2011

Quid Pro Quo: Builders, Politicians, and Election Finance in India - Working Paper 276 updated

In developing countries where elections are costly and accountability mechanisms weak, politicians often turn to illicit means of financing campaigns. This paper examines one such channel of illicit campaign finance: India’s real estate sector. Politicians and builders allegedly engage in a quid proquo, whereby the former park their illicit assets with the latter, and the latter rely on the former for favorable dispensation. At election time, however, builders need to re-route funds to politicians as a form of indirect election finance. One observable implication is that the demand for cement, the indispensible raw material used in the sector, should contract during elections since builders need to inject funds into campaigns. Using a novel monthly-level data set, we demonstrate that cement consumption does exhibit a political business cycle consistent with our hypothesis. Additional tests provide confidence in the robustness and interpretation of our findings.

Cover of Let Their People Come: Breaking the Gridlock on Global Labor Mobility
September 12, 2006

Let Their People Come: Breaking the Gridlock on Global Labor Mobility

This controversial book argues that irresistible demographic forces for greater international labor mobility are being checked by immovable anti-immigration ideas of rich-country citizens. Pritchett proposes breaking the gridlock through policies that support development while also being politically acceptable in rich countries. These include greater use of temporary worker permits, permit rationing, reliance on bilateral rather than multilateral agreements, and protection of migrants' fundamental human rights.

October 13, 2005

The Global Migration of Talent: What Does it Mean for Developing Countries?

Human capital flows from poor countries to rich countries are large and growing. A leading cause is the increasing skill-focus of immigration policy in a number of leading industrialized countries—a trend that is likely to intensify as rich countries age and competitive pressures build in knowledge-intensive sectors. The implications for development are complex and poorly understood.

Devesh Kapur and John McHale