Capitalism’s Challenges: Cycles of Expropriation

22 June 2009 at 3:13 pm Leave a comment

| Benito Arruñada |

Following up my previous entry on cycles of statism, I ask next: How important are cycles of expropriation? Consider, for example, how Bolivia has nationalized foreign oil firms every 34 years. In the most recent round, the nationalizing decree read:

Consider that Bolivia was the first country on the Continent to nationalize ts hydrocarbons, in 1937 with  Standard Oil Co, a heroic measure, and done again in 1969 with Gulf Oil, leading the present generation to carry on the third and definitive nationalization. (Supreme Decree 28701, Evo Morales, President, May 2006).

In an experiment with Marco Casari we find similar patterns under more “democratic” circumstances. You may download the paper here.

Entry filed under: Business/Economic History, Law and Economics, Public Policy / Political Economy.

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