Governance, productivity and economic development
Computational Finance
2025-12-04 v2
Abstract
This paper explores the interplay between transfer policies, R\&D, corruption, and economic development using a general equilibrium model with heterogeneous agents and a government. The government collects taxes, redistributes fiscal revenues, and undertakes public investment (in R\&D, infrastructure, etc.). Corruption is modeled as a fraction of tax revenues that is siphoned off and removed from the economy. We first establish the existence of a political-economic equilibrium. Then, using an analytically tractable framework with two private agents, we examine the effects of corruption and evaluate the impact of various policies, including redistribution and innovation-led strategies.
Keywords
Cite
@article{arxiv.2507.13099,
title = {Governance, productivity and economic development},
author = {Cuong Le Van and Ngoc-Sang Pham and Thi Kim Cuong Pham and Binh Tran-Nam},
journal= {arXiv preprint arXiv:2507.13099},
year = {2025}
}