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A change in the legal statute may be able to force an equilibrium if it leads to a new equilibrium which implies some revised belief which sustains the equilibrium. Tirole (1996) developed a model to study group reputation and demonstrated that an anticorruption programme of sufficient duration and severity can play in switching an economy from high corruption with sustained belief it to one with low corruption and sustained belief for it. This shift has wide spread impact on all most all the sectors of the economy.
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Jack and Jill live alone on an island. Their labour supply schedules are identical and given by L = (1 - t)w, where t is the income tax rate and w denotes the wage. Jill's wage i
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A change in the legal statute may be able to force an equilibrium if it leads to a new equilibrium which implies some revised belief which sustains the equilibrium. Tirole (1996)
For a very large part of 20 th century, we may recall, there existed capitalist market-oriented economies and socialist planning-oriented economies. 21stcentury is however witness
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