I propose a simple model of the relationship between economic growth and extractive taxation. A citizen and a ruler interact over time. The citizen owns a stock of capital which, in every period, yields some output. The ruler chooses how much output to expropriate for his private consumption, subject to the citizen's participation constraint. The growth rate of output is endogenous to the citizen's choice of effort. In this context, I define a social contract as a (Subgame Perfect) equilibrium of the repeated game. Moreover, a social contract is extractive at a given history if it leaves the citizen indifferent between the on path continuation and the outside option; and it is non-extractive otherwise.
The key tension of the model is that the citizen's effort in a given period increases output only in the future, when the ruler can always expropriate it. It follows that when players are myopic, any social contract is extractive. By contrast, when players are forward looking, any Pareto efficient and renegotiation proof social contract features a dual transition. As time passes, society endogenously moves from a regime of slow growth --- where extractive social contracts are implementable --- to a regime of fast growth --- where they are not.

European empires dominated entire continents for centuries. Yet, the literature on colonial legacies has largely focused on the long-term effects of colonialism in former colonies, overlooking its consequences for the former colonial powers themselves. In this article, we study the effect of Italy's colonial expansion in East Africa on contemporary political outcomes. Using data on all Italian soldiers buried in Eritrea and Ethiopia and the contemporary distribution of surnames across Italy, we construct an index of exposure to colonial wars at the municipality level. To isolate exogenous variation in municipalities' exposure, we exploit the historical geographical distribution of mountain troops of the Italian Army, which were largely deployed in East Africa because of Ethiopia's mountainous territory. We show that exposure to the 1930s colonial campaigns increased support for neo-fascist and nationalist parties in the immediate postwar electoral cycles, and still increases support for far-right parties today. Exploring possible mechanisms, we find that: (i) the effect is amplified in municipalities with a larger presence of Black African immigrants; (ii) far-right parties obtain larger electoral returns from anti-immigration rhetoric in municipalities with stronger colonial exposure. Taken together, our results suggest that the racial narratives used to justify the colonial expansion may have persisted across generations and continue to shape political attitudes today.

The political economy literature on social media has primarily focused on misinformation and polarization. We highlight a different and overlooked channel: the effect of data-driven voter profiling on politicians’ incentives to acquire policy-relevant information. We develop a model in which an incumbent politician can exert costly effort to learn about an uncertain state of the world before proposing a policy to a representative voter. The politician does not perfectly observe the voter's prior beliefs on the state of the world. Improvements in voter profiling, such as those enabled by social media, correspond to reductions in this uncertainty. The politician's learning effort increases her re-election chances through two channels: a quality effect, by improving the match between the policy and the true state; and a persuasion effect, by inducing voters to place lower weight on their prior and thereby compressing ex-post disagreement across possible voter types. We show that the higher the politician's uncertainty over the voter's prior, the stronger her incentives to exert effort to change it. Therefore, improved voter profiling lowers equilibrium learning effort and ultimately reduces the quality of democratic representation. 

-- SSRN working paper

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