Heed the Weakest Link : A Model of Interdependent Institutions
Alex Coad 1
Journal on Policy and Complex Systems • Volume 4 , Number 1 • Spring 2018
Professor , CENTRUM Católica Graduate Business School , Pontificia Universidad Católica del Perú , Lima , Peru .
Abstract
We present a simple multiplicative model of economic development , according to which the level of economic development is expressed in terms of the level of development of a large number of interdependent institutions . The “ weakest link in the chain ” of multiplicative terms determines the overall performance . The largest marginal benefits come from improving the weakest link . We discuss a number of implications .
JEL codes : O43 , E02 , O47
Keywords : institutions , institutional asymmetries , technological development , entrepreneurship , technological frontier
Acknowledgments : I am very grateful to Guido Fioretti and participants at the DIME Final Conference as well as 2 anonymous reviewers and the Editor for their many helpful comments and suggestions . Any remaining errors are mine alone .
Hágale caso al eslabón más débil : un modelo de instituciones interdependientes
Resumen
Presentamos un modelo multiplicativo simple de desarrollo económico y de acuerdo con este mismo , el nivel de desarrollo económico se expresa en términos del nivel de desarrollo de un gran
51 doi : 10.18278 / jpcs . 4.1.3