Center for Institutions, Policy and Culture in the Development Process

The research centre "Institutions, Policy and Culture in the Development Process" (IPCDP) promotes theoretical and empirical research on the structural transformation that accompanies economic development and on the determinants of its success or failure. This transformation involves changes in policies, institutions, and even preferences and social hierarchies.

Since China represents the most spectacular ongoing episode of economic transition, an important part of the activity of our centre focuses on the Chinese experience. The economic growth of China presents a number of special features that distinguish it from the earlier development of today's industrialized nations. Most notably, high growth is accompanied by a large increasing capital export, the falling labour share, and a fast reallocation across sectors and between firms of different productivity. The demographic transition of China has also peculiar features, due to the effects of the one-child policy introduced in 1978. This has important implications on growth in the decades to come and on the system of old age insurance. Other important aspects include the rise of a Chinese middle class, the housing market development, the process of technological catch up and the determinant of saving and investments.

The scope of our research goes beyond China. We study, from both a theoretical and applied standpoint, the relationship between innovation, intellectual property right protection, firms' organization and technology adoption. The role of industrial policy is also part of our research. Finally, we study the effect of culture and institutions on the process of economic development. We study, on the one hand, the diffusion of preferences and values that foster trust and cooperation. On the other hand, we analyze the determinants of the rise of that "entrepreneurial spirit" that has been and is an engine of growth in the development transition. More generally, we study the emergence and cultural transmission of preferences that are conducive to economic growth, and how they interact with the process of structural change.

The centre is structured in four research areas focusing on, respectively,
The great transformation of China;
The demand forces of the Chinese growth;
Innovation, technology adoption and cross-country income inequality;
Culture and institutions.

The IPCDP centre is financed by the European Research Council (Advanced Grant). Its Principal Investigator, Prof. Fabrizio Zilibotti, is the Chair of Macroeconomics and Political Economy at the Department of Economics of the University of Zurich. He is the winner of 2009 edition the Yrjo Jahnsson Award of the European Economic Association for greatly improving our understanding of how technological innovation affects economic growth at different stages of economic development...". The centre relies on the synergy between the research activities run at different chairs within the Department of Economics, under the direction of Professors Saez-Marti, Zweimüller and Zilibotti, and with the collaboration of numerous Assistant Professors, Post-Docs and Graduate Students. A key role is played by the network of international cooperations with some leading researchers worldwide, most of them based in China and the United States. Some of these researchers are affiliated with the IPCDP centre as international fellows.