We present a model in which workers make occupational choices and vote over a tax rate which determines the level of government spending. Workers in occupations whose services are in high (low) demand by the government favor high (low) taxes. We show that the socially efficient size of the public sector cannot be supported in a political economic equilibrium. The reason is that equilibrium tax rates always reward excessive entry into the politically most powerful sector, and thus the equilibrium size of government is always either too big or too small. We show that this is an example of a more general political economy result that extends well beyond the baseline model and holds quite generally: the combination of (i) competitive markets and (ii) free entry is inconsistent with (iii) allocative efficiency.
Røisland, Øistein; Sveen, Tommy & Torvik, Ragnar (2023)
Samspillet mellom penge- og finanspolitikken i en liten, åpen økonomi
Vi utvikler en teori for det optimale samspillet mellom penge- og finanspolitikken i konjunkturstyringen. Mens en i utgangspunktet kunne tro at penge- og finanspolitikken bør dra konjunkturene i samme retning, viser vi at dette ikke nødvendigvis er tilfelle. Dersom det ikke er store kostnader ved å bruke renten aktivt, skal penge- og finanspolitikken dra i hver sin retning ved inflasjonssjokk og valutakurssjokk. Grunnen er at pengepolitikken kan påvirke inflasjonen både gjennom etterspørselskanalen og gjennom valutakurskanalen, mens finanspolitikken bare kan benytte etterspørselskanalen. Pengepolitikken har derfor et komparativt fortrinn i å stabilisere inflasjonen, mens finanspolitikken har et komparativt fortrinn i å stabilisere produksjonen. Kun når det er tilstrekkelig store kostnader ved å endre renten, vil det være optimalt at penge- og finanspolitikken skal dra i samme retning ved inflasjonssjokk og valutakurssjokk. Kostnader ved bruk av finanspolitikk har ingen betydning for om penge- og finanspolitikk skal dra i samme retning eller ikke, men har implikasjoner for hvor sterk virkemiddelbruken bør være.
Bergholt, Drago; Røisland, Øistein, Sveen, Tommy & Torvik, Ragnar (2023)
We study how monetary policy should respond to shocks that permanently alter the steady state structure of the economy. In such a case monetary policy affects not only the short run misallocations due to nominal rigidities, but also relative prices which stimulate reallocation of capital. We consider a permanent and negative shock to export revenues that requires a larger traded sector and a smaller non-traded sector in the new steady state. This reallocation calls for a change in relative prices during the transition, but may also lead to a period of high unemployment. We show how an appropriate monetary policy could mitigate the welfare costs of the transition by allowing the exchange rate to depreciate, and thereby allowing inflation to increase in the short run. Traditional monetary policy regimes, such as inflation targeting or a fixed exchange rate, would imply high unemployment and inefficiently slow transition. Stabilizing nominal wage growth, in contrast, would be close to the welfare-optimal monetary policy.
Mehlum, Halvor & Torvik, Ragnar (2021)
The macroeconomics of COVID-19: a two-sector interpretation
We study the consequences of age-dependent preferences for economic growth and structural change in a two-sector model with overlapping generations and non-dimishing returns to capital. Savings and accumulation rates depend on the relative price of services consumed by old agents and on the intergenerational distribution of income. The feedback effects originating in preferences and income distribution yield three possible long-run growth outcomes: sustained endogenous growth, decumulation traps, and bounded accumulation. In the endogenous growth scenario, the transition features rising savings and accumulation rates accompanied by distributional shifts in favor of young workers, growing employment and rising prices in the service sector. Traps are triggered by initially low capital in manufacturing and low employment in services. Bounded accumulation yielding zero long-run growth in per capita incomes is induced by preferences, not by diminishing returns to capital.
Torvik, Ragnar (2020)
Formal Institutions and Development in Low-Income Countries: Positive and Normative Theory
For vestlige markedsøkonomier er koronakrisen en ny type krise, men denne krisen har paralleller til økonomier til andre tider, og til kriser på andre steder. Vi skal her drøfte noen mekanismer fra tidligere makrolitteratur, og fra litteratur om makroøkonomi for utviklingsland, som inneholder økonomiske sammenhenger som over natten er blitt relevante også for vår økonomi. Fenomener som flaskehalser, rasjonering, tvungen sparing, innsatsvarebegrenset produksjon, likviditetsbegrenset produksjon, lønnsomhetsbegrensning, sektorheterogenitet, og kostnader som løper selv om produksjonen stenger ned, er alle permanente fenomener i utviklingsland men de dukker også opp i rike land i krisetider. I denne artikkelen vil vi presentere noen av disse grundig utviklete, men delvis glemte, mekanismene innenfor enkle læreboksbeskrivelser og gi noen eksempler på hvordan virkningene av finans- og pengepolitikk blir modifisert i en krisetid.
Acemoglu, Daron; Robinson, James A. & Torvik, Ragnar (2020)
The political agenda effect and state centralization
We provide a potential explanation, based on the “political agenda effect”, for the absence of, and unwillingness to create, centralized power in the hands of a national state. State centralization induces citizens of different backgrounds, interests, regions or ethnicities to coordinate their demands in the direction of more general-interest public goods, and away from parochial transfers. This political agenda effect raises the effectiveness of citizen demands and induces them to increase their investments in conflict capacity. In the absence of state centralization, citizens do not necessarily band together because of another force, the escalation effect, which refers to the fact that elites from different regions will join forces in response to the citizens doing so. Such escalation might hurt the citizen groups that have already solved their collective action problem (though it will benefit others). Anticipating the interplay of the political agenda and escalation effects, under some parameter configurations, political elites strategically opt for a non-centralized state. We show how the model generates non-monotonic comparative statics in response to the increase in the value or effectiveness of public goods (so that centralized states and public good provision may be absent precisely when they are more beneficial for society). We also suggest how the formation of a social democratic party may sometimes induce state centralization (by removing the commitment value of a non-centralized state), and how elites may sometimes prefer partial state centralization.
Bjørnland, Hilde C; Thorsrud, Leif Anders & Torvik, Ragnar (2019)
In this paper we develop the first model to incorporate the dynamic productivity consequences of both the spending effect and the resource movement effect of oil abundance. We show that doing so dramatically alters the conclusions drawn from earlier models of learning by doing (LBD) and the Dutch disease. In particular, the resource movement effect suggests that the growth effects of natural resources are likely to be positive, turning previous growth results in the literature relying on the spending effect on their head. We motivate the relevance of our approach by the example of a major oil producer, Norway. Empirically we find that the effects of an increase in the price of oil may resemble results found in the earlier Dutch disease literature, while the effects of increased oil activity increases productivity in most industries. Therefore, models that only focus on windfall gains due to increased spending potential from higher oil prices, would conclude – incorrectly based on our analysis – that the resource sector cannot be an engine of growth.
Torvik, Ragnar (2019)
Ny teknologi, produktivitetsvekst og renter
133(3) , s. 40- 48.
Torvik, Ragnar (2018)
Oil prices and the exchange rate: Optimal monetary policy for oil-exporting countries
, s. 65- 74.
Torvik, Ragnar (2018)
Should Developing Countries Establish Petroleum Funds?
Many natural-resource-abundant countries have established petroleum funds as part of their strategy to manage their resource wealth. This paper examines reasons that such funds may be established, discusses how these funds are organized, and draws some policy lessons. The paper then develops a theory of how petroleum funds may affect the economic and political equilibrium of an economy, and how this depends on the initial institutions. A challenge with petroleum funds is that they may produce economic and political incentives that undermine their potential benefits. An alternative to establishing petroleum funds is to use revenues to invest domestically in sectors such as infrastructure, education, and health. Such investments have the potential to produce a better economic, as well as institutional, development. This is particularly the case if the initial institutions are weak.
Robinson, James A.; Torvik, Ragnar & Verdier, Thierry (2017)
The political economy of public income volatility: With an application to the resource curse
In recent years many countries have witnessed a great deal of volatility in public budgets, be it due to volatility in the access to foreign loans in Greece, or to unstable oil prices in Venezuela. We study the political consequences of such public income volatility. As is standard, in our model political incentives create inefficient policies to increase re-election probabilities, but we show that making public income uncertain creates specific new effects. Future volatility reduces the benefit of being in power, making policy more efficient. Yet at the same time it also reduces the re-election probability of an incumbent and since some of the policy inefficiencies are concentrated in the future, this makes inefficient policy, such as patronage public employment, less costly. Our model highlights a new political economy connection between the volatility of the public budget and economic growth. In the case where volatility comes from natural resource prices, a characteristic of many developing countries, we show that volatility in itself may be a source of inefficient resource extraction, jointly interacting with increased patronage employment.
Torvik, Ragnar (2017)
Pengepolitikk eller finanspolitikk i konjunkturstyringen?
We aim to explain petro populism|the excessive use of oil revenues to buy political support. To reap the full gains of natural resource income, politicians need to remain in o ce over time. Hence, even a rent-seeking incumbent who prioritizes his own welfare above that of citizens, will want to provide voters with goods and services if it promotes his probability of remaining in o ce. While this incentive bene ts citizens under the rule of rent-seekers, it adversely motivates benevolent policymakers to short-term overprovision of goods and services. In equilibrium, politicians of all types indulge in excessive resource extraction, while voters reward policies they realize cannot be sustained over time. Moreover, overextraction might even be reinforced as voters become better informed.
Voters often dismantle constitutional checks and balances on the executive. If such checks and balances limit presidential abuses of power and rents, why do voters support their removal? We argue that by reducing politician rents, checks and balances also make it cheaper to bribe or influence politicians through non-electoral means. In weakly institutionalized polities where such non-electoral influences, particularly by the better organized elite, are a major concern, voters may prefer a political system without checks and balances as a way of insulating politicians from these influences. When they do so, they are effectively accepting a certain amount of politician (presidential) rents in return for redistribution. We show that checks and balances are less likely to emerge when the elite is better organized and is more likely to be able to influence or bribe politicians, and when inequality and potential taxes are high (which makes redistribution more valuable to the majority). We also provide case study evidence from Bolivia, Ecuador, and Venezuela consistent with the model.
Mehlum, Halvor; Moene, Karl Ove & Torvik, Ragnar (2012)
Monetary policy decisions are typically characterized by three features: (i) decisions are
made by a committee, (ii) the committee members often disagree, and (iii) the chairman is
almost never on the losing side in the vote. We show that the combination of overconfident
policymakers and a chairman with agenda-setting rights can explain all these features. The
optimal agenda-setting power to the chairman is a strictly concave function of the degree
of overconfidence. We also show that the quality of advice produced by the central bank
staff is higher in a flat organization than in a hierarchical one.
Torvik, Ragnar (2011)
The Political Economy of Reform in Resource-Rich Countries
, s. 237- 255.
Chacón, Mario; Robinson, James A. & Torvik, Ragnar (2011)
When is Democracy an Equilibrium? Theory and Evidence from Colombia’s La Violencia
The conventional wisdom is that for a democracy to be consolidated, all groups must have a chance to attain power. If they do not, then they will subvert democracy and choose to fight for power. In this article, the authors show that this wisdom is seriously incomplete because it considers absolute, not relative payoffs. Although the probability of winning an election increases with the size of a group, so does the probability of winning an armed conflict. Thus, in a situation in which all groups have a high chance of winning an election, they may also have a high chance of winning a fight. Indeed, in a natural model, the authors show that democracy may never be consolidated in such a situation. Rather, democracy may only be stable when one group is dominant. The authors explore this key aspect of the theory using data from La Violencia, a political conflict in Colombia during the years 1946—1950 between the Liberal and Conservative parties. Consistent with their results, and contrary to conventional wisdom, the authors show that fighting between the parties was more intense in municipalities where the support of the parties was more evenly balanced.
Robinson, James A. & Torvik, Ragnar (2009)
A political economy theory of the soft budget constraint
Why do soft budget constraints exist and persist? In this paper we argue that the prevalence of soft budget constraints can be best explained by the political desirability of softness. We develop an infinite horizon political economy model where neither democratic nor autocratic politicians can commit to policies that are not ex post optimal. We show that because of the dynamic commitment problem inherent in the soft budget constraint, politicians can in essence commit to make transfers to entrepreneurs which otherwise they would not be able to do. This encourages such entrepreneurs to support them politically. Though the soft budget constraint may induce economic inefficiency, it may be politically rational because it influences the probability of political survival. In consequence, even when information is complete, politicians may fund bad projects which they anticipate they will have to bail out in the future. We show that, maybe somewhat surprisingly, dictators who are less likely to lose power, are more likely to use the soft budget constraint as a strategy to gain political support.
On average, resource-abundant countries have experienced lower growth over the last four decades than their resource-poor counterparts. But the most interesting aspect of the paradox of plenty is not the average effect of natural resources, but its variation. For every Nigeria or Venezuela there is a Norway or a Botswana. Why do natural resources induce prosperity in some countries but stagnation in others? This paper gives an overview of the dimensions along which resource-abundant winners and losers differ. In light of this, it then discusses different theory models of the resource curse, with a particular emphasis on recent developments in political economy.
Matsen, Egil; Sveen, Tommy & Torvik, Ragnar (2007)
Savers, Spenders and Fiscal Policy in a Small Open Economy
7(1)
This paper extends the savers-spenders theory of Mankiw (2000) to analyze fiscal policy in a small open economy with endogenous labor supply. It is first shown that tax cuts have a short-run contractionary effect on domestic production, and increased public spending has a short-run expansionary effect. Although consistent with recent empirical work, this result contrasts with those of most other theoretical models. Transitory changes in demand have permanent real effects in our model, and we discuss the implications for real exchange rate dynamics. We also show how ``rational" agents may magnify or dampen the responses of ``irrational" agents, and discuss how, unlike in previous contributions, this is in our model purely a result of the shape of rational agents' utility functions.
When the state fails to supply basic security and protection of property, violent entrepreneurs not only seize the opportunity of plundering, but some also enter the protection business and provide protection against plunderers. This uncoordinated division of labor is advantageous for the entire group of violent entrepreneurs. Hence, in weak states a situation may arise where a large number of violent entrepreneurs can operate side by side as plunderers and protectors squeezing the producers from both sides. The problem reached new levels at the end of the cold war. As military forces were demobilized without civilian jobs to go to, many countries got an oversupply of qualified violent people for crime, warfare and private protection. In this market for extortion the entry of new violent entrepreneurs enhances the profitability of them all. The supply of violence creates its own demand; an externality of violence that is detrimental to the development in poor countries.
Torvik, Ragnar; Leitemo, Kai & Røisland, Øistein (2002)
Time inconsistency and the exchange rate channel of monetary policy
104(3) , s. 391- 397.
Torvik, Ragnar (2001)
Learning by doing and the Dutch disease
45, s. 285- 306.
This paper develops a model of learning by doing and the Dutch disease that extends the earlier literature in two ways. First, it is assumed that both the traded and the non-traded sector can contribute to learing. Second, it is assumed that there are learning spillovers between the sectors. It is shown that within such a model a foreign exchange gift results in a real exchange rate depreciation in the long run, due to a shift in the contrast to standard models of the Dutch disease, production and productivity in both sectors may go up of down. The conditions for the different cases are worked out.
Torvik, Ragnar & Røisland, Øistein (2000)
Pengepolitisk regime og konkurranseutsatt sektor
, s. 187- 226.
Torvik, Ragnar (2000)
Kommentarer til Nasjonalbudsjettet 2001
54(7) , s. 20- 22.
Rattsø, Jørn & Torvik, Ragnar (1999)
The Macroeconomics of Foreign aid in Sub-Saharan Africa: Dutch Disease Effects Reconsidered
, s. 255- 274.
Davies, Rob; Rattsø, Jørn & Torvik, Ragnar (1998)
Short-run consequences of trade liberalization : a computable general equilibrium model of Zimbabwe (Reprint series / NTNU ; nr 85(1998))
20(3) , s. 305- 333.
Rattsø, Jørn & Torvik, Ragnar (1998)
Zimbabwean trade liberalization : ex post evaluation (Reprint series / NTNU ; nr 84(1998))
22, s. 325- 346.
Rattsø, Jørn & Torvik, Ragnar (1998)
Economic openness, trade restrictions and external shocks : modelling short run effects in Sub-Saharan Africa (Reprint series / NTNU ; nr 86(1998))
15, s. 257- 286.
Torvik, Ragnar (1997)
Agricultural supply-led industrialization : a macromodel with sub-Saharan African characteristics (Reprint series / NTNU ; nr 74(1997))
8, s. 351- 370.
Torvik, Ragnar (1997)
Real exchange rate dynamics and trade liberalization : the case of mulitple tariffs and unemployment (Reprint series / NTNU ; nr 78(1997))
6(3) , s. 329- 344.
Kvaløy, Ola; Møen, Jarle & Torvik, Ragnar (2023)
Unyansert om skatt
[Kronikk]
Nøstbakken, Linda & Torvik, Ragnar (2023)
Lakseskatt som på Færøyene er en dårlig idé
[Kronikk]
Haus-Reve, Silje; Dahl, Marianne, Torvik, Ragnar, Bergeijk, Peter A.G. van & Kvaløy, Ola (2022)
WAR ECONOMY The war in Ukraine has dramatically changed the outlook for the world economy. In a war economy the public obligation is to do what is necessary: to support the military effort to be able to protect and defend the territory under attract – leaving their everyday economy behind.
[Kronikk]
Russia’s invasion of Ukraine, and the sweeping sanctions the US and Europe have imposed on Russia in response, have triggered economic disruptions at four levels: direct, blowback, spillover, and systemic. But what are the long-term consequences of this disruptions war economy? How does it effect trade and do sanctions work as sticks for the development of the war?
Torvik, Ragnar (2017)
Rentepanel: – Rentefesten vil vare lenge
[Kronikk]
Torvik, Ragnar (2017)
- Rentefesten vil vare lenge
[Kronikk]
Torvik, Ragnar (2017)
Distrikt vil tape
[Kronikk]
Torvik, Ragnar (2017)
Brekke, Jensen og økonomiprofessorene om Trump og Brexit
[Kronikk]
Torvik, Ragnar (2017)
Fastrentekutt fra Lånekassen
[Kronikk]
Torvik, Ragnar (2017)
Verden skjelver i buksene
[Kronikk]
Torvik, Ragnar (2017)
Rentepanel: – Rentefesten vil vare lenge
[Kronikk]
Torvik, Ragnar (2017)
25 prosent børsvekst med Trump: – Jeg er egentlig veldig bekymra
[Kronikk]
Torvik, Ragnar (2017)
Norges fremste økonomer er nær samstemte om formuesskatt og arveavgift: Skattekutt øker ulikheten
[Kronikk]
Torvik, Ragnar (2017)
Mener prisfallet på boliger er større enn statistikken viser
[Kronikk]
Torvik, Ragnar (2017)
Må forvente fortsatt trykk på boligmarkedet i Moss
[Kronikk]
Torvik, Ragnar (2017)
Rentepanel: – Rentefesten vil vare lenge
[Kronikk]
Torvik, Ragnar (2017)
Flukten fra kemneren
[Kronikk]
Torvik, Ragnar (2017)
- Rentefesten vil vare lenge
[Kronikk]
Torvik, Ragnar (2017)
Opprøret i Venezuela: – Det er vanskelig å fatte hvor dyp denne krisen er
[Kronikk]
Torvik, Ragnar (2017)
Nasjonalisme, ikke ulikhet
[Kronikk]
Torvik, Ragnar (2017)
Rentepanel: – Rentefesten vil vara lenge
[Kronikk]
Torvik, Ragnar (2017)
- Rente-festen vil vare lenge
[Kronikk]
Moen, Espen Rasmus & Torvik, Ragnar (2017)
Oljefondet ut av oljeaksjer
[Kronikk]
Torvik, Ragnar (2017)
De som har tapt på globaliseringen, har ikke blitt tatt på alvor
[Kronikk]
Torvik, Ragnar (2017)
Norges Banks rentedom er klar: Holder renten uendret
[Kronikk]
Torvik, Ragnar (2017)
Rentepanel: – Rentefesten vil vare lenge
[Kronikk]
Torvik, Ragnar (2016)
Skal bruke 225 mrd. oljekroner
[Kronikk]
Torvik, Ragnar (2016)
Økonomer gir tommel opp for statsbudsjettet
[Kronikk]
Torvik, Ragnar (2016)
Karakterfall for finan sminister Siv Jensen
[Kronikk]
Torvik, Ragnar (2016)
Når det blir billigere å oppbevare penger i en bankboks
[Kronikk]
Torvik, Ragnar (2016)
Eksperter om olje- og gassutvinning i Algerie: Attraktivt, men flere skyr risikoen
[Kronikk]
Torvik, Ragnar (2016)
Varsler ny rentein struks
[Kronikk]
Torvik, Ragnar (2016)
Vil ikke ha lavere rente nå
[Kronikk]
Torvik, Ragnar (2016)
Avisene på 1-2-3
[Kronikk]
Torvik, Ragnar (2016)
Frykter rentefyring gir boligboble
[Kronikk]
Torvik, Ragnar (2016)
På nattbordet
[Kronikk]
Torvik, Ragnar (2016)
Kan få konsekvensar få norsk økonomi
[Kronikk]
Torvik, Ragnar (2016)
Oljeformuens verdi kan reduseres med to tredjedeler
[Kronikk]
Torvik, Ragnar (2016)
Advarer at to tredjedeler av oljeformuen kan forsvinne
[Kronikk]
Torvik, Ragnar (2016)
Slik rammer oljekrisa din økonomi
[Kronikk]
Torvik, Ragnar (2016)
Formuen redusert
[Kronikk]
Torvik, Ragnar (2016)
Byttet om roller på biblioteket
[Kronikk]
Torvik, Ragnar (2016)
Kuttpolitikk gir børsuro
[Kronikk]
Torvik, Ragnar (2016)
Venter negativ rente
[Kronikk]
Torvik, Ragnar (2016)
Skeptisk til nye boligkrav
[Kronikk]
Torvik, Ragnar (2016)
Rikingene drar ifra
[Kronikk]
Torvik, Ragnar (2016)
Fem økonomer i rentepanelet er enige
[Kronikk]
Torvik, Ragnar (2016)
Trur renta blir låg i lang tid framover
[Kronikk]
Torvik, Ragnar (2016)
Tid for å redusere eller fjerne fradraget nå
[Kronikk]
Torvik, Ragnar (2016)
Umulig å si hvor store konsekvensene blir
[Kronikk]
Torvik, Ragnar (2016)
En forsmak på det amerikanske presidentvalget
[Kronikk]
Torvik, Ragnar (2016)
Bilindustrien hadde ikke utviklet seg raskere om vi hadde skutt alle
[Kronikk]
Torvik, Ragnar (2016)
En gavepakke til EU - takket være britene
[Kronikk]
Torvik, Ragnar (2016)
To tredjedeler av oljeformuen kan ryke
[Kronikk]
Torvik, Ragnar (2016)
Hold på hatten!
[Kronikk]
Torvik, Ragnar (2016)
To tredeler av oljeformuen kan forsvinne
[Kronikk]
Torvik, Ragnar (2016)
Mye av oljeformuen kan forsvinne
[Kronikk]
Torvik, Ragnar (2016)
To tredjedeler av oljeformuen kan forsvinne
[Kronikk]
Torvik, Ragnar (2016)
1700 milliardar kan fordufte
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Torvik, Ragnar (2016)
Forberedt på å stramme inn
[Kronikk]
Torvik, Ragnar (2016)
Store deler av formuen kan forsvinne
[Kronikk]
Torvik, Ragnar (2016)
Venter negativ rente
[Kronikk]
Torvik, Ragnar (2016)
Økonomiprofessor på hjemmebane
[Kronikk]
Torvik, Ragnar (2016)
Å forlenge adgangen til permittering er et tveegget sverd
[Kronikk]
Torvik, Ragnar (2016)
Nå kommer fasiten fra Siv Jensen
[Kronikk]
Torvik, Ragnar (2016)
Solberg avviser refs for rekordstor oljepengebruk
[Kronikk]
Torvik, Ragnar (2016)
Alfahanner i duell
[Kronikk]
Torvik, Ragnar (2016)
«Alfahanner i duell»
[Kronikk]
Torvik, Ragnar (2016)
'Grunn til å være bekymret
[Kronikk]
Torvik, Ragnar (2016)
Det er en skattekonkurranse
[Kronikk]
Torvik, Ragnar (2016)
Én usikkerhetsfaktor peker seg ut for 2016
[Kronikk]
Torvik, Ragnar (2016)
Økonomene skroter gamle oljeprismodeller
[Kronikk]
Torvik, Ragnar (2016)
To tredjedeler av oljeformuen kan forsvinne
[Kronikk]
Torvik, Ragnar (2016)
To tredjedelar av oljeformuen kan forsvinne
[Kronikk]
Torvik, Ragnar (2016)
To tredjedeler av oljeformuen kan forsvinne
[Kronikk]
Torvik, Ragnar (2016)
Framtidig formue blir redusert
[Kronikk]
Torvik, Ragnar (2016)
Litt ekstra varme i skyggen av en krise
[Kronikk]
Torvik, Ragnar (2016)
Å forlenge adgangen til permittering er et tveegget sverd
[Kronikk]
Torvik, Ragnar (2016)
Her er Sivs hemmelighet
[Kronikk]
Torvik, Ragnar (2016)
Solberg avviser refs for rekordstor oljepengebruk
[Kronikk]
Torvik, Ragnar (2016)
Hollandsk syke
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Torvik, Ragnar (2016)
Kritiske til oljepenge bruken
[Kronikk]
Torvik, Ragnar (2016)
Selvfølgelig går andelen oljepenger opp i norsk økonomi
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Torvik, Ragnar (2016)
Klar beskjed til Siv: - Bruk mer oljepenger
[Kronikk]
Torvik, Ragnar (2016)
Bilindustrien hadde ikke utviklet seg raskere om vi hadde skutt alle hestene
[Kronikk]
Torvik, Ragnar (2016)
Kreativ bokføring
[Kronikk]
Torvik, Ragnar (2016)
Bandt nærmere 100 mill. i fastrente
[Kronikk]
Torvik, Ragnar (2016)
Frykter rentefyring gir boligboble
[Kronikk]
Torvik, Ragnar (2016)
Det er en skattekonkurranse i Europa
[Kronikk]
Torvik, Ragnar (2016)
Ny bunnotering for oljeprisen
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Torvik, Ragnar (2016)
NÅ BLØR NORGE
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Torvik, Ragnar (2016)
Skal passe på penga våre
[Kronikk]
Torvik, Ragnar (2016)
Vi må kaste oss med i de ulike debattene
[Kronikk]
Torvik, Ragnar (2016)
Reformer eller stimuli?
[Kronikk]
Torvik, Ragnar (2016)
Splittet om boligmedisin
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Torvik, Ragnar (2016)
Danske Bank vil ut av skyggen
[Kronikk]
Torvik, Ragnar (2016)
BRUK MER OLJESENGER
[Kronikk]
Torvik, Ragnar (2016)
Fem økonomer i rentepanelet er enige
[Kronikk]
Torvik, Ragnar (2016)
Dynamisk meg her og der
[Kronikk]
Torvik, Ragnar (2016)
Spår rekordlav rente i flere år
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Torvik, Ragnar (2016)
Spår rekordlav rente i flere år
[Kronikk]
Torvik, Ragnar (2016)
Mye av oljeformuen kan forsvinne
[Kronikk]
Torvik, Ragnar (2016)
To tredelar av oljeformuen kan forsvinne
[Kronikk]
Torvik, Ragnar (2016)
Innherred er også en del av verdensbildet
[Kronikk]
Torvik, Ragnar (2016)
Dette er konsekvensene av de lave rentene
[Kronikk]
Torvik, Ragnar (2016)
Urbant område
[Kronikk]
Torvik, Ragnar (2015)
"Kommunene må påregne mindre penger"
[Kronikk]
Torvik, Ragnar (2015)
Svart mandag kan gi bekmørk høst
[Kronikk]
Torvik, Ragnar (2015)
Ekspertene er skeptiske
[Kronikk]
Torvik, Ragnar (2015)
Trekker Jensen for høy pengebruk
[Kronikk]
Torvik, Ragnar (2015)
Toppøkonomer ber Siv Jensen ruste opp Norge
[Kronikk]
Matsen, Egil & Torvik, Ragnar (2015)
Hemmeligholder søkere
[Kronikk]
Torvik, Ragnar (2015)
- Uendret rente mot boligboble
[Kronikk]
Torvik, Ragnar (2015)
"Gjør at forskjellene blir større
[Kronikk]
Torvik, Ragnar (2015)
Dette bør du vite om rentekuttene
[Kronikk]
Torvik, Ragnar (2015)
Tre mot to
[Kronikk]
Torvik, Ragnar (2015)
- Ser ingen lettvinte løsninger for Hellas
[Kronikk]
Torvik, Ragnar (2015)
Snart helt tomt for penger
[Kronikk]
Torvik, Ragnar (2015)
- Ungene våre betaler vårt forbruk
[Kronikk]
Torvik, Ragnar (2015)
Ser lavere lønnsvekst
[Kronikk]
Torvik, Ragnar (2015)
Økonomisk kollaps i Kina kan ha startet
[Kronikk]
Torvik, Ragnar (2015)
Flere land kan rammes av ressurs-forbannelsen
[Kronikk]
Torvik, Ragnar (2015)
- Jeg tror ikke grekerne forstår hva de stemmer over
[Kronikk]
Torvik, Ragnar (2015)
– Dette kan være starten på Kinas kollaps
[Kronikk]
Torvik, Ragnar (2015)
Dette bør du vite om rentekuttene
[Kronikk]
Torvik, Ragnar (2015)
Optimister - tross dystre spådommer
[Kronikk]
Torvik, Ragnar (2015)
Går for rentekutt
[Kronikk]
Torvik, Ragnar (2015)
Mener renta burde vært kuttet
[Kronikk]
Torvik, Ragnar (2015)
Fortsetter oljefesten
[Kronikk]
Torvik, Ragnar (2015)
I samme båt
[Kronikk]
Torvik, Ragnar (2015)
Tror rentekutt nå kan gjøre vondt verre
[Kronikk]
Torvik, Ragnar (2015)
«Ingen krise», sier Olsen, men møtes med skepsis
[Kronikk]
Torvik, Ragnar (2015)
Blir bedt om å bygge flere veier
[Kronikk]
Matsen, Egil & Torvik, Ragnar (2015)
NTNU-forsker vil passe Oljefondet
[Kronikk]
Torvik, Ragnar (2015)
''Det minste ondet er å senke renten''
[Kronikk]
Torvik, Ragnar (2015)
Advarer om krakk
[Kronikk]
Torvik, Ragnar (2015)
- Må ta følgen av at vi er blitt fattigere
[Kronikk]
Torvik, Ragnar (2015)
Etterlyser strakstiltak
[Kronikk]
Torvik, Ragnar (2015)
- Det er neppe noen god idé å holde igjen på pengesekken nå
[Kronikk]
Torvik, Ragnar (2015)
Halvparten tror de får mer å rutte med
[Kronikk]
Torvik, Ragnar (2014)
Interest rate cut demands among oil price fall
[Kronikk]
Torvik, Ragnar (2014)
Krever rentekutt mot oljepriskollaps
[Kronikk]
Torvik, Ragnar (2014)
Økonomiprofessorer mener Norges Bank må kutte renten
[Kronikk]
Torvik, Ragnar (2014)
Økonomi-professorer mener Norges Bank må senke renten
[Kronikk]
Torvik, Ragnar (2014)
Økonomer mener Norges Bank må kutte renten
[Kronikk]
Torvik, Ragnar (2014)
Interest rate cut demands among oil price fall
[Kronikk]
Torvik, Ragnar (2014)
Ber om rentekutt nå
[Kronikk]
Torvik, Ragnar (2014)
Norsk styringsrente må ned over en prosent
[Kronikk]
Torvik, Ragnar (2014)
Kina vil redusere veksten i Norge
[Kronikk]
Torvik, Ragnar (2014)
Advarer mot lavere rente
[Kronikk]
Torvik, Ragnar (2014)
Derfor slakter de Erna og Siv
[Kronikk]
Torvik, Ragnar (2014)
Professorer: - Handlingsregelen er for raus
[Kronikk]
Torvik, Ragnar (2014)
Kommentar ga twitter-kamp
[Kronikk]
Torvik, Ragnar (2014)
Vil halvere renten
[Kronikk]
Torvik, Ragnar (2014)
Agenda samler krem en av akademikere
[Kronikk]
Torvik, Ragnar (2014)
Oljeprisen kan gi rente under én prosent
[Kronikk]
Torvik, Ragnar (2014)
Har økt med 24 mrd. på ett år
[Kronikk]
Torvik, Ragnar (2014)
Agenda samler kremen av akademikere
[Kronikk]
Torvik, Ragnar (2014)
Vil vrake dagens handlingsregel
[Kronikk]
Torvik, Ragnar (2014)
Fallende oljepris kan halvere renten
[Kronikk]
Torvik, Ragnar (2014)
"SAGT PÅ NETT"
[Kronikk]
Torvik, Ragnar (2014)
Kan gi rentekutt denne uken
[Kronikk]
Torvik, Ragnar (2014)
Må kutte renta nå
[Kronikk]
Torvik, Ragnar (2014)
Etterlyser tiltakspakke
[Kronikk]
Torvik, Ragnar (2014)
Mener Norges Bank må kutte renten nå
[Kronikk]
Torvik, Ragnar (2014)
Økonomer mener Norges Bank må kutte renten
[Kronikk]
Torvik, Ragnar (2014)
Svekket OPEC fort- setter i samme takt
[Kronikk]
Torvik, Ragnar (2014)
Frykter lang tørke
[Kronikk]
Torvik, Ragnar (2014)
Fortsatt fall i oljeprisen etter Opec-beslutning
[Kronikk]
Torvik, Ragnar (2014)
Professorer: - Handlingsregelen er for raus
[Kronikk]
Torvik, Ragnar (2014)
ICA AB er børsvinner i Sverige
[Kronikk]
Torvik, Ragnar (2014)
Agenda samler krem
[Kronikk]
Torvik, Ragnar (2014)
NHO: - Norges Bank bør vurdere rentekutt nå
[Kronikk]
Torvik, Ragnar (2014)
ANDRE MENINGER
[Kronikk]
Torvik, Ragnar (2014)
Melkekartongen ble for hard
[Kronikk]
Torvik, Ragnar (2014)
Økonomer om oljeprisfallet: - Kutt renta nå
[Kronikk]
Torvik, Ragnar (2014)
Oljeprisfallet: - Kutt renta nå
[Kronikk]
Torvik, Ragnar (2014)
Bommer
[Kronikk]
Torvik, Ragnar (2014)
Norges Bank må kutte renten
[Kronikk]
Torvik, Ragnar (2014)
Kina kommer til å kollapse
[Kronikk]
Torvik, Ragnar (2014)
OPEC-nei ga fortsatt fall i oljeprisen
[Kronikk]
Torvik, Ragnar (2014)
FÅR SKATTESMELL Superøkonomer gir Erna & co. det glatte lag
[Kronikk]
Torvik, Ragnar (2014)
Svekket OPEC fortsetter i samme takt
[Kronikk]
Torvik, Ragnar (2014)
Enige om uendret rente
[Kronikk]
Torvik, Ragnar (2014)
Verdien av våre gjenværende oljereserver vil barberes kraftig
[Kronikk]
Torvik, Ragnar (2014)
Fortsatt fall i oljeprisen etter OPEC-beslutning
[Kronikk]
Torvik, Ragnar (2014)
Fallende oljepris kan halvere renten
[Kronikk]
Torvik, Ragnar (2014)
Uenige om rentebanen
[Kronikk]
Torvik, Ragnar (2014)
Fallende oljepris kan halvere renten
[Kronikk]
Torvik, Ragnar (2014)
Har økt med 24 mrd. på ett år
[Kronikk]
Torvik, Ragnar (2014)
Fallende oljepris kan halvere renten
[Kronikk]
Torvik, Ragnar (2014)
Handlingsregelen er for raus
[Kronikk]
Torvik, Ragnar (2014)
Oljeprisen kan gi rente under én prosent
[Kronikk]
Torvik, Ragnar (2014)
Ekspert: - Norge vil få renter nær null
[Kronikk]
Torvik, Ragnar (2014)
Fallende oljepris kan halvere renta
[Kronikk]
Torvik, Ragnar (2014)
Dette har skjedd natt til tirsdag 09.12
[Kronikk]
Torvik, Ragnar (2014)
Frykter lang tørke
[Kronikk]
Torvik, Ragnar (2014)
Kina kommer til å kollapse
[Kronikk]
Torvik, Ragnar (2014)
Frykter lang tørke
[Kronikk]
Torvik, Ragnar (2014)
Frykter overoptimisme i boligmarkedet
[Kronikk]
Torvik, Ragnar (2014)
Bråk og insentiver
[Kronikk]
Torvik, Ragnar (2014)
Pumper opp olje som før
[Kronikk]
Torvik, Ragnar (2014)
Fortsatt fall i oljeprisen etter OPEC-beslutning
[Kronikk]
Torvik, Ragnar (2014)
Kutter ikke i oljeproduksjonen
[Kronikk]
Torvik, Ragnar (2014)
Kritiske til oljepengebruken
[Kronikk]
Torvik, Ragnar (2014)
Med ryggraden som sugerør
[Kronikk]
Torvik, Ragnar (2014)
Slik blir 2015
[Kronikk]
Torvik, Ragnar (2014)
Økonomer mener Norges Bank må kutte renten
[Kronikk]
Torvik, Ragnar (2014)
Fallande oljepris kan halvere renta
[Kronikk]
Torvik, Ragnar (2014)
Spår renten under én prosent
[Kronikk]
Torvik, Ragnar (2014)
Oljeprisfallet: - Kutt renta nå
[Kronikk]
Torvik, Ragnar (2014)
Økonomer mener Norges Bank må kutte renten
[Kronikk]
Torvik, Ragnar (2014)
Ber om rentekutt nå
[Kronikk]
Torvik, Ragnar (2014)
DNs rentepanel
[Kronikk]
Torvik, Ragnar (2014)
Vil ha lavere rente
[Kronikk]
Torvik, Ragnar (2014)
Økonomer mener Norges Bank må kutte renten
[Kronikk]
Torvik, Ragnar (2014)
Frykter overoptimisme i boligmarkedet
[Kronikk]
Torvik, Ragnar (2014)
Superøkonomer gir Erna & co. skattesmell
[Kronikk]
Torvik, Ragnar (2014)
Professorer: - Handlingsregelen er for raus
[Kronikk]
Torvik, Ragnar (2014)
Kritiske til oljepengebruken
[Kronikk]
Torvik, Ragnar (2014)
Agenda engasjerer sju akademiske rådgivere
[Kronikk]
Torvik, Ragnar (2014)
OLJE: Fallet i oljepris
[Kronikk]
Torvik, Ragnar (2014)
Agenda engasjerer sju akademiske rådgivere
[Kronikk]
Torvik, Ragnar (2014)
Fallande oljepris kan halvere renta
[Kronikk]
Torvik, Ragnar (2014)
Rekordlav rente kan bli halvert
[Kronikk]
Torvik, Ragnar (2014)
Professorer mener handlingsregelen er for raus
[Kronikk]
Torvik, Ragnar (2014)
Bildet er blitt styrket
[Kronikk]
Torvik, Ragnar (2014)
4 % Handlingsregelen for bruk
[Kronikk]
Torvik, Ragnar (2014)
Nå er det full olje-forvirring i DNB
[Kronikk]
Torvik, Ragnar (2014)
Frykter lang tørke
[Kronikk]
Torvik, Ragnar (2013)
Bankene gjør jobben for Olsen
[Kronikk]
Torvik, Ragnar (2013)
Vil ikke endre renten
[Kronikk]
Torvik, Ragnar (2013)
Ber Johnsen snu om hemmelighold
[Kronikk]
Torvik, Ragnar (2013)
Er boligmarkedet sykt?
[Kronikk]
Torvik, Ragnar (2013)
Øystein Olsen får kritikk for forrige rentekutt
[Kronikk]
Torvik, Ragnar (2013)
Johnsen fortsetter hemmeligholdet
[Kronikk]
Torvik, Ragnar (2013)
Øystein Olsen får kritikk for forrige rentekutt
[Kronikk]
Torvik, Ragnar (2013)
Hvordan reagerer du på at bankene hever renten?
[Kronikk]
Torvik, Ragnar (2013)
Gir Jensen smekk
[Kronikk]
Torvik, Ragnar (2013)
Skal boligprisene opp eller ned?
[Kronikk]
Torvik, Ragnar (2013)
Ber om større bank-buffer
[Kronikk]
Torvik, Ragnar (2013)
Splittet syn på renteutsikter
[Kronikk]
Torvik, Ragnar (2013)
Ber om avklaring Splittet syn
[Kronikk]
Torvik, Ragnar (2013)
Handlingsregelens sisteskanse
[Kronikk]
Torvik, Ragnar (2013)
For ivrige banker
[Kronikk]
Torvik, Ragnar (2013)
Handlingsregelens sisteskanse
[Kronikk]
Torvik, Ragnar (2012)
Mener Olsen burde satt renten høyere
[Kronikk]
Torvik, Ragnar (2012)
Ap: Helt uaktuelt å legge om boligskatten
[Kronikk]
Matsen, Egil & Torvik, Ragnar (2012)
Basker mellom kutt og innsats
[Kronikk]
Torvik, Ragnar (2012)
- Uaktuelt å legge om boligskatten
[Kronikk]
Torvik, Ragnar (2012)
Vil ha klarere kommunikasjon fra Norges Bank
[Kronikk]
Torvik, Ragnar (2012)
- Norges Bank bør bli mer uavhengig
[Kronikk]
Torvik, Ragnar (2012)
– Norske politikere ikke bedre enn greske
[Kronikk]
Torvik, Ragnar (2012)
Ap: - Uaktuelt å legge om boligskatten
[Kronikk]
Torvik, Ragnar (2012)
Vil ikke legge om boligskatten
[Kronikk]
Torvik, Ragnar (2012)
Ap: - Helt uaktuelt å legge om boligskatten
[Kronikk]
Torvik, Ragnar (2012)
Mange sparer til barna sine
[Kronikk]
Matsen, Egil & Torvik, Ragnar (2012)
Bøter til EU-land som ikke kutter
[Kronikk]
Torvik, Ragnar (2012)
Vil frata Jens all rentemakt
[Kronikk]
Torvik, Ragnar (2012)
Vil løsrive Norges Bank
[Kronikk]
Matsen, Egil & Torvik, Ragnar (2012)
EU basker mellom kutt og innsats
[Kronikk]
Torvik, Ragnar (2011)
Takk, kjære Greenspan!
[Kronikk]
Torvik, Ragnar (2011)
-Euroen kan kollapse
[Kronikk]
Torvik, Ragnar (2011)
HÅPER PÅ NY OLJEFEST - ...men eksperter advarer mot bakrus etter gigantfunn
[Kronikk]
Torvik, Ragnar (2011)
- Flere rentehopp er «bensin på bålet»
[Kronikk]
Torvik, Ragnar (2011)
Euroen «kan kollapse», mener norske økonomiprofessorer
[Kronikk]
Torvik, Ragnar (2011)
Så mye tåler du gjeld Gjelden du realistisk tåler
[Kronikk]
Torvik, Ragnar (2011)
Statsledere presset til å levere
[Kronikk]
Torvik, Ragnar (2011)
- Sannsynlig med ny finanskrise
[Kronikk]
Torvik, Ragnar (2011)
Takk, kjære Greenspan!
[Kronikk]
Torvik, Ragnar (2011)
Mener EU bør la Hellas gå konk
[Kronikk]
Torvik, Ragnar (2011)
Statsledere presset til å levere
[Kronikk]
Torvik, Ragnar (2011)
Gullpriser til himmels
[Kronikk]
Torvik, Ragnar (2011)
-Krevende spagat
[Kronikk]
Torvik, Ragnar (2011)
Euroens siste sjanse - igjen
[Kronikk]
Torvik, Ragnar (2010)
Staten har subsidiert DnB Nor
[Kronikk]
Torvik, Ragnar (2010)
Dobbeltmoral å være i skatteparadis
[Kronikk]
Torvik, Ragnar (2010)
Mener staten har subsidiert DnB Nor
[Kronikk]
Torvik, Ragnar (2009)
Toppforskernes råd til NTNU
[Kronikk]
Matsen, Egil & Torvik, Ragnar (2009)
Gullkortet er statsstøtte, Skauge!
[Kronikk]
Torvik, Ragnar (2007)
Lærer u-land nasjonalisering
[Kronikk]
Torvik, Ragnar (2006)
Virker underlig
[Kronikk]
Torvik, Ragnar (2005)
Overflodens paradoks
[Kronikk]
Torvik, Ragnar (2005)
Advarer mot «billige» lån
[Kronikk]
Torvik, Ragnar; Fjeldstad, Odd-Helge & Sjursen, Ingrid Hoem (2023)
Findings and recommendations from the report of the Norwegian Expert Committee on Tax Reform
[Lecture]. Event
Presentation by Ragnar Torvik. Organized and moderated by Odd-Helge Fjeldstad and Ingrid Hoem Sjursen
Mehlum, Halvor; Natvik, Gisle James & Torvik, Ragnar (2021)
The Inefficient Combination: Competitive Markets, Free Entry, and Democracy
[Report Research].
We show that under fairly general conditions, the combination of (i) competitive markets, (ii) free entry, and (iii) democracy is inconsistent with allocative efficiency. This fundamental impossibility result, which has not been derived before, holds whenever not only prices, but also policy, responds to factor allocations. We develop a theory where agents enter an occupation (more generally, enter an economic activity) and thereafter make a policy decision. Thus, each voter's self interest becomes endogenous to the entry decision. In our baseline model, the policy instrument that citizens decide upon is simply taxation. Workers in occupations whose services are in high demand by the government have an incentive to vote for high taxes. Voters in occupations whose services are in low demand by the government have an incentive to vote for low taxes. We show that the socially efficient size of the public sector cannot be sustained in equilibrium, despite free entry into occupations. We generalize our theory, and show how our impossibility result extends well beyond the baseline model. We also discuss how departing from competitive markets may affect equilibrium outcomes. Our analysis implies that when assessing causes and consequences of factor allocations, it is key to acknowledge how allocations affect not only prices, but also policies.
Mehlum, Halvor & Torvik, Ragnar (2020)
Macroeconomics in the time of the Corona
[Report Research].
For a developed market economies, the corona crisis is a new type of crisis, but this crisis has parallels to economies at other times, and to crises at other places. We discuss some mechanisms from the traditional macro literature, and from the literature on macroeconomics for developing countries, which contains economic mechanisms that overnight have also become more relevant to developed market economies. Phenomena such as bottlenecks, rationing, forced savings, production constrained by access to inputs, liquidity constraints, sector heterogeneity, and costs running despite production being shut down, are all permanent phenomena in developing countries. During the corona crisis, however, they have also emerged as key mechanisms in developed market economies. We discuss some of these well developed, but partially forgotten mechanisms, by extending simple textbook descriptions, and we provide some examples of how the effects of fiscal and monetary policy are modified in a time of crisis.
Davies, Rob; Mehlum, Halvor, Moene, Karl Ove (Kalle) & Torvik, Ragnar (2020)
How the Zimbabweans pay for the war against covid-19
Should Central Banks care about Traded and non-Traded Sectors?
[Professional Article]. 5(1)
Torvik, Ragnar; Mehlum, Halvor & moene, karl ove (2005)
Cursed by resources or institutions?
[Report Research].
Natural resource abundant countries constitute both growth losers and growth winners, and the main difference between the success cases and the cases of failure lays
in the quality of institutions. With grabber friendly institutions more natural resources push aggregate income down, while with producer friendly institutions more
natural resources increase income. Such a theory finds strong support in data. A key question we also discuss is if resources in addition alter the quality of institutions.
When that is the case, countries with bad institutions suffer a double resource curse - as the deterioration of institutions strenghtens the negative effect of more natural
resources.
Aslaksen, Silje & Torvik, Ragnar (2005)
A theory of civil conflict and democracy in rentier states
[Report Research].
The effects of resource rents on the political equilibrium have been studied in two main types of models. The first tradition employs models of conflict, and studies how resource rents affect the intensity and duration of civil conflict. The second tradition employs political economy models, where resource rents affect the political equilibrium because the costs and benefits of buying votes change. Although providing much insight, a primary disadvantage of these two model traditions is that they have little to say about when democracy emerges, and
about when conflict emerges. This question is simply determined by the type of model one chooses to study. Yet an important empirical literature suggests that a main effect of resource rents may be exactly that it affects the political choice between democracy and civil conflict.
In this paper, by integrating the earlier model traditions, we suggest the simplest possible framework we can think of to study this choice. The institutional outcome in our theory is consequently endogenous. We show how factors such as resource rents, the extent of electoral competition, and productivity affect economic and political equilibria, and discuss how our approach, mechanisms and results differ from the earlier theories.
Torvik, Ragnar & Robinson, James A. (2005)
A political economy theory of the soft budget constraint
[Conference Lecture]. Event
Aslaksen, Silje & Torvik, Ragnar (2005)
Conflict and democracy in rentier states
[Conference Lecture]. Event
Torvik, Ragnar (2005)
Globale Ubalanser
[Lecture]. Event
Torvik, Ragnar (2005)
Utviklingstrekk i verdensøkonomien - konsekvenser for Norge
[Lecture]. Event
Matsen, Egil; Torvik, Ragnar & Sveen, Tommy (2005)
Savers, spenders, and fiscal policy in a small open economy
[Conference Lecture]. Event
Torvik, Ragnar & Robinson, James A. (2005)
A political economy theory of the soft budget constraint
[Conference Lecture]. Event
Torvik, Ragnar & Robinson, James A. (2005)
A political economy theory of the soft budget constraint
[Report Research].
Why do soft budget constraints exist and persist? In this paper we argue that the prevalence of soft budget constraints can be best explained by the political desirability of softness. We develop a political
economy model where politicians cannot commit to policies that are not ex post optimal. We show that because of the dynamic commitment problem inherent in the soft budget constraint, politicians can in essence commit to make transfers to entrepreneurs which otherwise they would not be able to do. This encourages such entrepreneurs to
vote for them. Though the soft budget constraint may induce economic inefficiency, it may be politically rational because it influences the outcomes of elections. In consequence, even when information is complete, politicians may fund bad projects which they anticipate they will have to bail out in the future.
Torvik, Ragnar & Robinson, James A. (2004)
White Elephants
[Conference Lecture]. Event
Torvik, Ragnar & Robinson, James A. (2004)
A Political Economy Theory of the Soft Budget Constraint
[Conference Lecture]. Event
Torvik, Ragnar (2004)
Kommentarer til Norges Banks årsrapport
[Lecture]. Event
Torvik, Ragnar & Robinson, James A. (2004)
White Elephants
[Conference Lecture]. Event
Torvik, Ragnar & Aslaksen, Silje (2004)
Conflict and Democracy in Rentier States
[Conference Lecture]. Event
Matsen, Egil; Torvik, Ragnar & Sveen, Tommy (2004)
Savers, spenders and fiscal policy in a small open economy
[Conference Lecture]. Event
Matsen, Egil; Torvik, Ragnar & Sveen, Tommy (2004)
Savers, spenders and fiscal policy in a small open economy
[Conference Lecture]. Event
Torvik, Ragnar; Mehlum, Halvor & Moene, Karl (2004)
Institutions and the resource curse
[Conference Lecture]. Event
Torvik, Ragnar & Robinson, James A. (2004)
A Political Economy Theory of the Soft Budget Constraint
[Conference Lecture]. Event
Torvik, Ragnar & Robinson, James A. (2004)
A Political Economy Theory of the Soft Budget Constraint
[Conference Lecture]. Event
Matsen, Egil & Torvik, Ragnar (2004)
Optimal Dutch disease
[Conference Lecture]. Event
Torvik, Ragnar; Mehlum, Halvor & Moene, Karl (2004)
Rainfall, Poverty and Crime in 19th Century Germany, MEMORANDUM No 04/2004
[Report Research].
Matsen, Egil; Torvik, Ragnar & Sveen, Tommy (2004)
Savers, Spenders and Fiscal Policy in a Small Open Economy
[Report Research].
This paper analyzes the effects of fiscal policy in an open economy. We extend the savers-spenders theory of Mankiw (2000) to a small open economy with endogenous labor supply. We first show how the Dornbusch (1983) consumption-based real interest rate for open economies is modified when labor supply is endogenous. We then turn to the effects of fiscal policy when there are both savers and spenders. With this heterogeneity taken into account, tax cuts have a short-run contractionary effect on domestic production, and increased public spending has a short-run expansionary effect. Although consistent with recent empirical work, this result contrasts with those of most other theoretical models. Transitory changes in demand have permanent real effects in our model, and we discuss the implications for real exchange-rate dynamics. We also show how "rational" savers may magnify or dampen the responses of "irrational" spenders, and show how this is related to features of the utility functions.
Matsen, Egil; Torvik, Ragnar & Sveen, Tommy (2004)
Savers, spenders and fiscal policy in a small open economy
Predator or Prey? Parasitic enterprises in economic development
[Report Research].
In many developing and transition economies Mafia-like activities are rampant. Extortion and other forms of predation lower profitability in private businesses and distort investment incentives. Incorporated in a model of industrialization, bimodal club convergence may result. Economies may get stuck in a Predators' Club characterized by a vicious circle of poverty and predation. Societies with a low flow of new entrepreneurs are especially vulnerable to predation and never get out of this club. Poor societies with high flow of new entrepreneurs, however, may grow out of the trap and join the rich Producers' Club.
A dynamic macroeconomic model is used to analyse the interaction between economic growth, unemployment and crime. The model exhibits increasing returns to aggregate capital due to endogenous crime. Capital investments increases the demand for labor and reduces the extent of criminal activity. Reduced criminal activity in turn increases the return on capital. As this linkage works via the aggregate labor demand the increasing return is external to the individual firm. Hence, the economy has possibly two equilibria: a) One where unemployment and crime rates are high and capital stock and income is low. and b) one where unemployment and crime rates are low and capital stock and income is high. Equilibrium a) has the characteristics of a poverty trap. The existence of a poverty trap has important implications for the speed of reform implementation. A too abrupt reform may throw the economy into a vicious circle of increasing crime and unempoyment
