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Oil, Macro Volatility and Crime in the Determination of Beliefs in Venezuela

Author

Listed:
  • Di Tella, Rafael
  • Donna, Javier
  • MacCulloch, Robert
Abstract
We use data on political beliefs (broadly, left-right position, meritocracy and origins of poverty) to discuss Venezuela’s economic institutions. Our starting point is the large role attributed to beliefs in determining the economic system and the extent of government intervention (see, for example, Alesina et al, 2001). This brings us to the question of what causes changes in beliefs. We briefly discuss and present some evidence consistent with the idea that some of the main social and economic forces that affected Venezuela this century may have changed people’s rational beliefs. These include a dependence on oil, a history of macro-economic volatility, the rise in crime and the rise in a preoccupation with corruption. We end up with a cautionary result: although these results point in the direction of giving a role to real shocks in the determination of beliefs, we test and find that perceptions for different phenomena are sometimes correlated. In particular, the perception of corruption is related to the perception of crime rather than the amount of real corruption actually experienced.

Suggested Citation

  • Di Tella, Rafael & Donna, Javier & MacCulloch, Robert, 2007. "Oil, Macro Volatility and Crime in the Determination of Beliefs in Venezuela," MPRA Paper 67002, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:67002
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    File URL: https://mpra.ub.uni-muenchen.de/67002/1/MPRA_paper_67002.pdf
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    References listed on IDEAS

    as
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    5. Alberto Alesina & Edward Glaeser & Bruce Sacerdote, 2001. "Why Doesn't The US Have a European-Style Welfare State?," Harvard Institute of Economic Research Working Papers 1933, Harvard - Institute of Economic Research.
    6. Thomas Piketty, 1995. "Social Mobility and Redistributive Politics," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(3), pages 551-584.
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    Cited by:

    1. Paola Giuliano & Antonio Spilimbergo, 2009. "Growing Up in a Recession: Beliefs and the Macroeconomy," NBER Working Papers 15321, National Bureau of Economic Research, Inc.
    2. Rafael Di Tella & Robert MacCulloch, 2009. "Why Doesn't Capitalism Flow to Poor Countries?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 40(1 (Spring), pages 285-332.
    3. Rafael Di Tella & Juan Dubra & Robert MacCulloch, 2008. "A Resource Belief-Curse? Oil and Individualism," NBER Working Papers 14556, National Bureau of Economic Research, Inc.

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    More about this item

    Keywords

    beliefs; oil; crime; corruption; macro volatility; perceptions; causality;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

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