International Society for Quantitative History

Workshops

Swords into Bank Shares: Financial Solutions to the Threat of Political Violence

12:30 | Friday, December 13, 2019

Asia Global Institute, MB 328, 3/F Main Building, HKU

English

Saumitra Jha

Saumitra Jha

Associate Professor of Political Economy, Stanford Graduate School of Business

The failure to align the incentives of conflictual groups in favor of peaceful coexistence and beneficial reforms is often seen as a major cause of persistent underdevelopment around the world. However, much less is known about strategies that have been successful at overcoming such political economy challenges. One approach that holds much promise, and in fact appears to have had some historical success, is the provision of financial assets that align the interests of winners and potential losers from reform by providing claims on the future.

In this workshop, Saumitra Jha analyzes the promise and limitations of financial instruments as a means for fostering broad political coalitions that favor peace and beneficial reforms. It takes as a departure point the benchmark theory of portfolio choice, in which all agents hold the same (market) portfolio of risky assets. This may also align political incentives, as all individuals can gain from policies that improve the returns or lower the risks of the market portfolio, including risks stemming from political instability and conflict. He then analyzes a range of historical cases in which the introduction of financial assets has succeeded or failed at making politics less conflictual over time, focusing on three revolutionary states that subsequently led the world in economic growth: England, the early United States and Meiji Japan. Next he exploits a series of field experiments to test whether financial mechanisms can help raise support for peace in contemporary settings which face the threat of violence, including in India, Israel and elsewhere. Finally, he draws upon the theory, the historical cases and the field experiments to assess the promise and limitations of financial approaches in solving political economy challenges more generally.

Friday, December 13, 2019

Asia Global Institute, MB 328, 3/F Main Building, HKU

Saumitra Jha

English

The Society decided to launch the Quantitative History Webinar Series in Spring 2020 through Zoom given the Covid-19 pandemic. We hereby thank the Asia Global Institute for hosting our Economic History Workshops from September 2018 to January 2020.

While we hope to resume in-person events as soon as the city can get beyond this pandemic, please stay tuned for further updates.

We thank the Asia Global Institute for organizing this workshop. 

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