TY - CHAP A1 - Schnellenbach, Jan ED - Henrekson, Magnus ED - Sandström, Christian ED - Stenkula, Mikael T1 - A Behavioral Economics Perspective on the Entrepreneurial State and Mission-Oriented Innovation Policy T2 - Moonshots and the New Industrial Policy: Questioning the Mission Economy N2 - It is argued that the concepts of mission-oriented innovation policy and also of the entrepreneurial state will lead to the implementation of policies that are highly vulnerable to behavioral biases and the inefficient use of heuristics. In political practice, we can therefore not expect efficient mission-oriented policies. In particular, I argue that missions as a political commitment mechanism intended to devote massive resources to a specific cause will often only work if biases like the availability bias and loss aversion are deliberately used in order to secure voter consent. Furthermore, I also argue that the argument used by Mazzucato (Mission Economy: A Moonshot Guide to Changing Capitalism. London: Penguin UK, 2021) herself also contains several behavioral biases. Y1 - 2024 SN - 9783031491955 U6 - https://doi.org/10.1007/978-3-031-49196-2_4 SN - 1572-1922 SP - 61 EP - 76 PB - Springer Nature Switzerland CY - Cham ER - TY - GEN A1 - Schwuchow, Sören C. T1 - Organized crime as a link between inequality and corruption T2 - European Journal of Law and Economics N2 - We study a model that establishes a novel theoretical rationale for the empirically well-documented relation between inequality and corruption. According to our model, inequality can nurture corruption by empowering organized crime because collusion between local police forces and criminal organizations is more likely in societies characterized by high inequality or weak security forces. Law enforcement and organized crime have a strong incentive to collude due to efficiency gains from specialization. However, their agreement breaks down when the mobsters can no longer credibly commit to joint rent maximization and thus start to compete with law enforcement for citizens’ wealth. The mobsters then non-violently monopolize the market for extortion by undercutting the police forces, similar to a strategy of predatory pricing. Criminal collusion is thus not very different from its corporate equivalent; hence, similar policy measures should be promising. In addition, our model also suggests that the criminal organization’s higher efficiency in extracting rents has a greater impact when the relative power between law enforcement and organized crime is rather balanced. Accordingly, when violent conflict becomes less predictable, non-violent elements of relative power become more relevant. Our model also allows for the interpretation that in the absence of strong social norms against corruption, organized crime is more difficult to challenge. KW - Inequality KW - Corruption KW - Organized crime KW - Public security Y1 - 2023 U6 - https://doi.org/10.1007/s10657-023-09764-x SN - 0929-1261 VL - 55 IS - 3 SP - 469 EP - 509 ER - TY - GEN A1 - Schnellenbach, Jan T1 - The Concept of Ordnungspolitik: Rule-Based Economic Policy-Making from the Perspective of the Freiburg School T2 - Public Choice Y1 - 2023 U6 - https://doi.org/10.1007/s11127-021-00903-z SN - 1573-7101 VL - 195 SP - 283 EP - 300 ER - TY - GEN A1 - Schwuchow, Sören C. A1 - Tridimas, George T1 - The political economy of Solon’s law against neutrality in civil wars T2 - Public Choice N2 - In 594 BCE, the Athenian lawgiver Solon, called upon to resolve a deepening social crisis, introduced a new constitution and mandated that in civil conflicts, no citizen is to remain apathetic and must take sides. Because the law seemed to support strife, it presents a puzzle. The paper offers a political economy rationale for Solon’s law against neutrality, modeling social conflict as a rent-seeking competition. We divide society into three groups, a hereditary aristocracy, which monopolized power before the Solonian constitution, a rival wealth-based commercial elite, called the new Solonian elite, and the poor, who are enfranchised only partly. We then identify the conditions under which the third group is better off by allying with one of the other groups, protecting the Solonian constitution. In our framework, Solon’s ban on neutrality is an attempt to change the payoffs from violent redistributions of rents, so that conflict is avoided. Accordingly, the ban should not only impede excessive rent seeking, but also prevent the exclusion of any social group. KW - Ancient Athens KW - Solon KW - Political non-neutrality KW - Rent seeking KW - Intra-elite competition KW - Political apathy KW - Civil war KW - Inclusive institutions Y1 - 2022 UR - https://link.springer.com/article/10.1007/s11127-022-00980-8 U6 - https://doi.org/10.1007/s11127-022-00980-8 SN - 1573-7101 VL - 192 IS - 3-4 SP - 249 EP - 272 ER - TY - GEN A1 - Groß, Steffen T1 - On the Regulation of the International Exchange of Cultural Property T2 - ORDO : Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft N2 - With its foundation in 1945, UNESCO declared as its main purpose the promotion of international cultural exchange1. A number of legal instruments (Conventions, Recommendations and Declarations) should duly help to substantiate that general purpose and make it work in practice. In this process, the regulation of the international exchange of cultural property plays a key role. However, the proper regulation of cultural property exchange has been a highly controversial issue. This paper focus on UNESCO's guiding ideas and conceptions of cultural property, international exchange and regulation. The central question is: Are the regulations codified in UNESCO’s Conventions and Recommendations helpful in encouraging international cultural exchange or are we faced, due to the neglect of private agents and the roles they play in cultural exchange, with some sort of one-sided regulation running counter to that aim? The author argues that UNESCO's legal instruments are driven by and express a strong anti-private and anti-market bias, which produce problematic economic incentives in the art and antiquities world to the disadvantage of the international exchange of cultural property. Y1 - 2020 UR - https://www.degruyter.com/view/journals/ordo/70/1/article-p166.xml?tab_body=pdf-69320 SN - 0048-2129 VL - 70 IS - 1 SP - 166 EP - 187 ER - TY - GEN A1 - Schnellenbach, Jan A1 - Schubert, Christian T1 - A note on the behavioral political economy of innovation policy T2 - Journal of Evolutionary Economics Y1 - 2019 U6 - https://doi.org/10.1007/s00191-019-00625-y SN - 1432-1386 SN - 0936-9937 VL - 29 IS - 5 SP - 1399 EP - 1414 ER - TY - GEN A1 - Schnellenbach, Jan T1 - Revisiting the tension between classical liberalism and the welfare state T2 - Journal of Contextual Economics Y1 - 2019 SN - 2568-7603 SN - 2568-762X VL - 139 IS - 2-4 SP - 365 EP - 384 ER - TY - GEN A1 - Schnellenbach, Jan T1 - On the Behavioural Political Economy of Regulating Fake News T2 - Ordo - Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft Y1 - 2018 SN - 2366-0481 SN - 0048-2129 VL - 68 SP - 197 EP - 219 ER - TY - CHAP A1 - Schnellenbach, Jan ED - Valdesalici, Alice ED - Palermo, Francesco T1 - Fiscal Sovereignty in a Globalised World: The Pressure of European Fiscal Governance on Domestic Public Finance T2 - Comparing Fiscal Federalism Y1 - 2018 SN - 978-90-04-34095-4 SP - 328 EP - 346 PB - Brill-Martinus Nijhoff CY - Leiden ER - TY - GEN A1 - Groß, Steffen T1 - Can Cultural Property Protection Be an Effective Counter-Terrorism Instrument? T2 - The Journal of Art Crime Y1 - 2018 SN - 1947-5926 VL - 19 SP - 47 EP - 59 ER - TY - GEN A1 - Schwuchow, Sören C. T1 - Military Spending and Inequality in Autocracies: A Simple Model T2 - Peace Economics, Peace Science and Public Policy N2 - In this note, we outline a general framework for analyzing how inequality and military spending interact in a society governed by a rent-seeking autocrat. Relying on a general equilibrium model, we show that, generally, the autocrat utilizes the military for redistribution in favor of poorer citizens. However, the dictator’s own rent-seeking activity weakens the extent of redistribution and, in the extreme, can even reverse its direction, yielding more unequal secondary distributions instead. Accordingly, the initial level of inequality also affects the impact of military spending on inequality as the former has an impact on the extent of both, the regime’s rent-seeking activity as well as redistribution. Here, our model shows that primary and secondary distributions are rather equal for extreme initial equality/inequality. For medium levels of initial inequality, redistribution is rather large and can be in favor of the poor or of the rich, depending on the extent of rent-seeking and the primary distribution. Based on these results, we highlight the importance of a society’s institutional framework for analyzing the relation of inequality and military spending. KW - Inequality KW - autocracies KW - military spending KW - rent-seeking Y1 - 2018 UR - https://www.degruyter.com/view/j/peps.2018.24.issue-4/peps-2018-0025/peps-2018-0025.xml?format=INT U6 - https://doi.org/10.1515/peps-2018-0025 SN - 1554-8597 VL - 24 IS - 4 ER - TY - GEN A1 - Schnellenbach, Jan T1 - Evolving Hierarchical Preferences and Behavioral Economic Policies T2 - Public Choice Y1 - 2018 U6 - https://doi.org/10.1007/s11127-018-0607-4 SN - 1573-7101 SN - 0048-5829 VL - 178 IS - 1/2 SP - 31 EP - 52 ER - TY - CHAP A1 - Schnellenbach, Jan ED - Eccleston, Richard ED - Krever, Richard T1 - German Federalism at the Crossroads: Renegotiating the Allocation of Competencies in a New Financial Environment T2 - The Future of Federalism: Intergovernmental Fiscal Relations in an Age of Austerity Y1 - 2017 SN - 978-1-78471-777-3 SP - 147 EP - 172 PB - Elgar CY - Cheltenham, UK ER - TY - GEN A1 - Pitsoulis, Athanassios A1 - Schwuchow, Sören C. T1 - Holding out for a better deal: Brinkmanship in the Greek bailout negotiations T2 - European Journal of Political Economy N2 - Greece and its creditors concluded negotiations over a third bailout by signing a Memorandum of Understanding on 19 August 2015. The dominant view among most economic policy analysts and commentators seems to be that the actions of the Greek government in the months before the deal had been erratic and lacked coordination. In this paper we argue instead that the decisions of the Greek leaders, including asking the voters to reject the earlier terms demanded by the creditors in a referendum, can be rationally explained by the logic of brinkmanship. We develop a game-theoretic model to show that the actions of the Greek government are consistent with a strategy aimed at getting a better bailout deal. KW - Greek debt crisis KW - Crisis management KW - Brinkmanship Y1 - 2017 UR - http://www.sciencedirect.com/science/article/pii/S0176268016301574 U6 - https://doi.org/10.1016/j.ejpoleco.2016.08.011 SN - 0176-2680 VL - 48 SP - 40 EP - 53 ER - TY - GEN A1 - Schnellenbach, Jan T1 - A Constitutional Economics Perspective on Soft Paternalism T2 - Kyklos N2 - Using a framework that distinguishes short-term consumer preferences, individual reflective preferences and political preferences, we discuss from a constitutional economics perspective whether individuals find it in their common constitutional interest to endow representatives and bureaucrats with the competence to impose soft paternalist policies. The focus is specifically on soft paternalist policies, because these often work with non-transparent 'nudges' that are considered as manipulative in some contributions to the literature. We show that those soft paternalist policies that are manipulative indeed collide with three criteria of consumer sovereignty, reflective sovereignty and citizen sovereignty that can be argued to represent common constitutional interest of citizens. On the other hand, we argue that the set of paternalist policies that is deemed acceptable on the constitutional level is restricted to non-manipulative instruments, and their application as government policies is limited to cases with stable and very homogenous preferences. However, we also argue that competitive markets are capable of supplying many mechanisms that allow individuals to cope with problems in their decision-making processes on a private level. Y1 - 2016 U6 - https://doi.org/10.1111/kykl.12106 SN - 1467-6435 VL - 69 IS - 1 SP - 135 EP - 156 ER - TY - GEN A1 - Baskaran, Thushyanthan A1 - Feld, Lars P. A1 - Schnellenbach, Jan T1 - Fiscal Federalism and Economic Growth: A Meta-Analysis T2 - Economic Inquiry N2 - The theoretical literature on the economics of fiscal federalism has identified several potential effects of government decentralization on economic growth. Much of the traditional literature focuses on the efficiency aspects of a decentralized provision of public services. However, decentralization may also increase growth by raising the ability of the political system to innovate and carry out reforms. On the contrary, some authors argue that decentralization increases corruption and government inefficiency. After a discussion of the theoretical arguments, we provide both a traditional survey and a meta-analysis of the empirical literature on decentralization and economic growth. Based on our survey, we identify open questions and discuss possible ways of answering them. Y1 - 2016 U6 - https://doi.org/10.1111/ecin.12331 SN - 1465-7295 VL - 54 IS - 3 SP - 1445 EP - 1463 ER - TY - GEN A1 - Schnellenbach, Jan T1 - Does Classical Liberalism Imply an Evolutionary Approach to Policy-Making? T2 - Journal of Bioeconomics N2 - This paper argues that an evolutionary approach to policy-making, which emphasizes openness to change and political variety, is particularly compatible with the central tenets of classical liberalism. The chief reasons are that classical liberalism acknowledges the ubiquity of uncertainty, as well as heterogeneity in preferences and beliefs, and generally embraces gradual social and economic change that arises from accidental variation rather than deliberate, large-scale planning. In contrast, our arguments cast doubt on a different claim, namely that classical liberalism is particularly compatible with the evolutionary biological heritage of humans. KW - Classical liberalism KW - Evolution KW - Darwinism KW - Economic policy KW - Cultural evolution KW - Institutional evolution Y1 - 2015 U6 - https://doi.org/10.1007/s10818-014-9188-6 SN - 1573-698 VL - 17 IS - 1 SP - 53 EP - 70 ER - TY - GEN A1 - Schnellenbach, Jan A1 - Schubert, Christian T1 - Behavioral political economy: A survey T2 - European Journal of Political Economy N2 - In explaining individual behavior in politics, economists should rely on the same motivational assumptions they use to explain behavior in the market: that is what Political Economy, understood as the application of economics to the study of political processes, is all about. In its standard variant, individuals who play the game of politics should also be considered rational and self-interested, unlike the benevolent despot of traditional welfare economics. History repeats itself with the rise of behavioral economics: Assuming cognitive biases to be present in the market, but not in politics, behavioral economists often call for government to intervene in a “benevolent” way. Recently, however, political economists have started to apply behavioral economics insights to the study of political processes, thereby re-establishing a unified methodology. This paper surveys the current state of the emerging field of “behavioral political economy” and considers the scope for further research. KW - Behavioral political economy KW - Rational irrationality KW - Cognitive biases KW - Social norms KW - Voting KW - Paternalism Y1 - 2015 U6 - https://doi.org/10.1016/j.ejpoleco.2015.05.002 SN - 0176-2680 VL - 40 IS - B SP - 395 EP - 417 ER - TY - GEN A1 - Groß, Steffen A1 - Pitsoulis, Athanassios T1 - "The Other Side of the Argument": Isaiah Berlin versus F.A. von Hayek on Liberty, Public Policies and the Market T2 - Constitutional Political Economy Y1 - 2015 U6 - https://doi.org/10.1007/s10602-015-9193-3 SN - 1572-9966 SN - 1043-4062 VL - 26 IS - 4 SP - 475 EP - 494 ER - TY - GEN A1 - Feld, Lars P. A1 - Schnellenbach, Jan T1 - Political Institutions and Income (Re-)Distribution: Evidence from Developed Economies T2 - Public Choice N2 - We discuss the effect of formal political institutions (electoral systems, fiscal decentralization, presidential and parliamentary regimes) on the extent and direction of income (re-)distribution. Empirical evidence is presented for a large sample of 70 economies and a panel of 13 OECD countries between 1981 and 1998. The evidence indicates that presidential regimes are associated with a less equal distribution of disposable incomes, while electoral systems have no significant effects. Fiscal competition is associated with less income redistribution and a less equal distribution of disposable incomes, but also with a more equal primary income distribution. Our evidence also is in line with earlier empirical contributions that find a positive relationship between trade openness and equality in primary and disposable incomes, as well as the overall redistributive effort. KW - Redistribution KW - Formal institutions KW - Fiscal decentralization KW - Presidential and parliamentary regimes KW - Electoral systems Y1 - 2014 U6 - https://doi.org/10.1007/s11127-013-0116-4 SN - 1573-7101 VL - 159 IS - 3 SP - 435 EP - 455 ER -