Explain how elections in countries with democratic political institutions can place controls on corruption
What will be an ideal response?
Elections are a good way of disciplining politicians and restricting corruption because elections incentivize politicians by offering rewards and punishments—reelection versus being voted out of office. Depending on the availability of undistorted information, voters can reward good behavior with reelection and punish bad behavior by switching their votes.
A-head: CONTROLLING POLITICIANS
Concept: Electoral controls on politicians
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The "nonconvergence" problem with the Solow growth model is that
A) a higher return to capital in poor countries should essentially cause all nations to have roughly the same standard of living, yet they clearly do not. B) if a disturbance dislodges an economy from the steady-state point, it continues moving further from that point indefinitely. C) technological change is assumed to just "drop from the sky." D) a rise in the rate of national saving does not raise the growth rate of real GDP per person.
According to the Strong Coase Theorem, when will the assignment of property rights have no effect on the allocation of resources?
a. Always. b. When there are no transactions costs. c. When there are no transactions costs and changes in the distribution of income do not have significant effects on market demand curves. d. When liability is assigned to the party with the least-cost method of dealing with an externality problem.