Topic: State Power and Taxation in Autocracies:Theory and Evidence from Late Imperial China

Speaker:Qiang Chen

Affiliation: School of Economics, Shandong University

Time:Tuesday, 14 Octorber. 14:00-15:30pm

Location:Room 217, Guanghua Building 2

Abstract：

While autocracy has been the dominant political system of the world, few theories have

tried to understand how it works. We propose a game-theoretic model to study the fundamental problem of tax conflict and political violence in autocracies. The game is played by a ruler and her people, where political violence is a two-way threat. The ruler can invest in state coercive power to deter rebellions, but it is costly to do so. The equilibrium tax rate and state power are jointly determined. We then take the theory to a rich data set of prefectural-level land taxes in late imperial China. The empirical strategy exploits exogenous variations in army sizes due to foreign defense and rugged terrain to identify the causal effects of army sizes on per capita land taxes. The results from GMM estimations are consistent with the theory.

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