Browsing by Author "Borcan, Oana"

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Economic Determinants and Consequences of Political Institutions
(2015-10-15) Borcan, Oana
This thesis is comprised of four empirical essays on the economic determinants and consequences of political institutions. It opens with a broad perspective on the link between the state throughout history and the past and current economic performance of nations. The rest of the chapters focus on a particular form of institutional failure - "endemic corruption" - with illustrations of its harmful impact on key development areas: human capital formation and democracy. More specifically, chapters two and three identify causal links between public sector wages, monitoring and incentives and corruption in education. The final chapter examines the clientelistic structure of electoral politics showing that local politicians in can influence national elections by vote buying and electoral fraud.
Fighting Corruption in Education: What Works and Who Benefits?
(2015-02) Borcan, Oana; Lindahl, Mikael; Mitrut, Andreea; Dept. of Economics, University of Gothenburg
We investigate the efficiency and distributional consequences of a corruptionfighting initiative in Romania targeting the endemic fraud in a high-stakes high school exit exam, which introduced CCTV monitoring of the exam and credible punishment threats. We find that punishment coupled with monitoring was effective in reducing corruption. Estimating the heterogeneous impact for students of different ability, poverty status, and gender, we show that fighting corruption led to efficiency gains (ability predicts exam outcomes better) but also to a worrisome score gap increase between poor and non-poor students. Consequently, the poor students have reduced chances to enter an elite university.
State History and Economic Development: Evidence from Six Millennia
(2014-08) Borcan, Oana; Olsson, Ola; Putterman, Louis; Dept. of Economics, University of Gothenburg
All since the rise of the first civilizations, economic development has been closely intertwined with the evolution of states. In this paper, we contribute to the literature on state history and long-run economic development in four ways. First, we extend and complete the state history index from Bockstette, Chanda and Putterman (2002) by coding the experience with states from the first state origins, 3500 BCE, up until 2000 CE. Second, we explore empirically the relationship between time since transition to agriculture and state age, as well as subsequent state history. Our estimated unconditional correlation implies that a 1000 year earlier transition to agriculture is associated with a 470 years earlier emergence of state institutions. We show how this relationship differs between indigenously- and externally- originated states. Third, we show that the relationship between our extended state history index and current levels of economic development has the shape of an inverted u. The results reflect the fact that countries that were home to the oldest states, such as Iraq, Egypt and China, are poorer today than younger inheritors of their civilizations, such as Germany, Denmark and Japan. This pattern was already in place by 1500 CE and is robust to adjusting for migrations during the colonial era. Finally, we demonstrate a very close relationship between state formation and the adoption of writing.
The Impact of an Unexpected Wage Cut on Corruption: Evidence from a "Xeroxed" Exam
(2012-06) Borcan, Oana; Mikael, Lindahl; Andreea, Mitrut; Dept of Economics, University of Gothenburg
This paper aims to understand how corruption responds to financial incentives and, in particular, it is an attempt to identify the causal impact of a wage loss on the prevalence of corruption in the education sector. Specifically, we exploit the unexpected wage cut in May 2010 that affected all Romanian public sector employees, including the public education staff, and examine its effect on students’ scores on the high-stakes national exam which occurs at the end of high school—the Baccalaureate. To exploit the effect of an income shock on corruption, we use a difference-in-difference strategy and compare the change in the exam outcomes between the public schools—the treatment group—and the private schools—the control group, which were unaffected by the wage cut. Our findings suggest that the wage loss led the public schools to have better exam outcomes than the private schools in 2010 relative to 2009. We attribute this difference to the increased involvement in corrupt activities by public school staff, which was driven by financial incentives. These results match an unprecedentedly high number of allegations of fraud and bribery against school principals, which earned the 2010 Baccalaureate the title of the Xeroxed exam—akin to identical test answers found to have been distributed to numerous students.
Transition to Agriculture and First State Presence: A Global Analysis
(University of Gothenburg, 2018-09) Borcan, Oana; Olsson, Ola; Putterman, Louis; Dept. of Economics, University of Gothenburg
It has often been observed that the emergence of states in a region is typically preceded by an earlier transition to agricultural production. Using new data on the date of first state emergence within contemporary countries, we present a global scale analysis of the chronological relationship between the transition to agriculture and the subsequent emergence of states. We find statistically significant relationships between early reliance on agriculture and state age in all sub-samples. Our findings show that this relationship is not markedly different in cases where states were imposed from outside or when they emerged through internal origination.