ERC Consolidator Grant · 2016
Political and Business Networks
I explore the role of networks involving firms---networks between firms and politicians, and networks between firms and firms--for economic outcomes. I focus on two broad questions. (1) What are the determinants and implications of political favor networks? Although political favoritism affects allocations in many countries, its mechanisms are not well understood. I develop a new model based on the idea of trust embedded in favor networks, and test in Hungarian data the model's implications about how political centralization shapes favoritism. I also quantify the welfare cost of misallocation created by favoritism. My results help understand how political institutions shape economic…
From the public funding record at EU CORDIS. Describes the funded project, not the reviews below.