When Elders Rule: Is Gerontocracy Harmful for Growth?

Vincenzo Atella, Lorenzo Carbonari
2013 Social Science Research Network  
We study the relationship between gerontocracy and aggregate economic perfomance in a simple model where growth is driven by human capital accumulation and productive government spending. We show that gerontocraticélites display the tendency to underinvest in public education and productive government services and thereby may be harmful growth. In absence of intergenerational altruism, the damage caused by gerontocracy is mainly due to the lack in long-term delayed-return investment originated
more » ... y the shorter life horizon of the ruling class with respect to the rest of the population. An empirical analysis is carried out on a rich data set that allows to test theoretical results across different countries and different sectors. The econometric results confirm our main hypotheses.
doi:10.2139/ssrn.2213840 fatcat:u7ihczzribeijfqfb37oz2u25y