arXiv subjects

Rok Spruk

Publications and source records attributed to Rok Spruk.

16 recordsLinked to original sources

arXiv2026

Public Signals, Concealed Choices: Dynamic Measurement without Behavioral Identification

Members of collective institutions may leave public traces while their individual choices remain concealed. This paper separates a corpus-conditional public position from the behavioral rule linking that position to participation and secret choice. I measure the first with a dynamic ordinal state-space model and establish a likelihood-exclusion result for the second. If behavioral-link parameters enter only the distribution of an entirely unobserved outcome and are a priori independent of measurement parameters, public signals leave their posterior equal to their prior. Declared monotone mappings are therefore reported as sensitivity envelopes, not estimates or identified bounds. Cabinet-sized simulations compare dynamic measurement with a static ordinal model and transparent summaries, exposing gains from temporal pooling and failures under weak measurement or omitted dimensionality. The application reconstructs 41 pre-decision official-source records preceding a concealed Slovenian cabinet decision. Only six of 21 ministers have attributable signals. The model locates a small visible group but leaves the remainder prior-dominated. Event-dependence adjustments, coding perturbations, rolling prediction, and the subsequently disclosed record support the same conclusion. Uncertainty should track the public information environment rather than be converted into unsupported behavioral precision.

stat.ME↗

arXiv2026

Reputation, Exposure, and Exit: Organizational Turnover after #MeToo

We study how economy-wide reputational shocks reshape corporate governance by examining board and executive turnover following the MeToo movement. We conceptualize the October 2017 revelations surrounding Harvey Weinstein as a common information shock that increased the expected cost of misconduct and intensified scrutiny across firms. Identification exploits cross-sectional variation in pre-shock exposure, measured by the frequency of Item 5.02 Form 8-K filings, which proxy for firms' sensitivity to governance-related disclosure and reputational risk. We develop a model of organizational exit in which directors respond to changes in reputational pressure through dynamic, belief-driven resignation hazards, generating heterogeneous and potentially nonlinear responses across firms. Empirically, we implement a continuous-treatment difference-in-differences design and complement it with dynamic event-study and matrix-completion estimators. We find that firms with greater pre-shock exposure experience significantly larger increases in resignation activity following the shock. The effects are concentrated in the immediate aftermath of the Weinstein revelations and are amplified through board-level interactions. The findings provide causal evidence that reputational shocks can induce rapid and systematic governance turnover, highlighting the central role of information, exposure, and organizational adaptation in shaping corporate responses to changes in the reputational environment.

econ.GN↗

arXiv2026

Long-Term Health and Human Capital Effects of Universal Health Care and Mass Literacy: Evidence from Cuba

We estimate long-run effects of Cuba's 1961 National Health Service and contemporaneous National Literacy Campaign using synthetic-control methods on newly assembled series for 21 former European colonies in the Americas, 1900--2022. Relative to synthetic Cuba, infant mortality falls 15--29 percent and average years of schooling rise 1.5--2 years; both effects are large, persistent, and robust to augmented SCM, synthetic difference-in-differences, interactive fixed effects, and matrix completion. Life-expectancy gains attenuate after 1990, consistent with the post-Soviet Special Period, suggesting that bundled health and literacy reforms permanently raise early-life survival and human capital, with smaller and less robust effects on adult longevity.

econ.GN↗

arXiv2026

Statehood Without Capacity

This paper develops a political-economy theory of statehood without capacity. I argue that under specific institutional and geopolitical conditions, a polity can become trapped in an equilibrium of nominal statehood: a state in which claims to sovereignty, external recognition, and symbolic legitimacy persist or even strengthen while the coercive, fiscal, administrative, and legal capacities required for effective statehood remain weak. The mechanism is driven by three forces. First, fragmented elites may privately benefit from preserving autonomous control, patronage, and localized rent extraction rather than consolidating authority into a unified state. Second, externally mediated transfers can reduce the immediate costs of institutional non-consolidation and thereby stabilize a low-capacity equilibrium. Third, international recognition and symbolic endorsement may be only weakly conditioned on domestic administrative performance, allowing recognition capital to accumulate more rapidly than capacity capital. The theory generates a dynamic divergence between juridical or symbolic statehood and effective statehood, with implications for investment, fiscal fragility, corruption, and vulnerability to conflict shocks. The paper derives testable predictions and then interprets Palestine as a flagship application of the broader mechanism. The central implication is that statehood is not only a question of recognition or territorial claim but an equilibrium outcome of institutional consolidation. Where the incentives to consolidate remain weak, sovereignty may be asserted without becoming viable.

econ.GN↗

arXiv2026

Confrontation with the West and Long-Run Economic and Institutional Outcomes: Evidence from Iran

This paper studies the long-run economic and institutional consequences of Iran's confrontation with the West, treating the 2006-2007 strategic shift as the onset of a sustained confrontation regime rather than a discrete sanctions episode. Using synthetic control and generalized synthetic control methods, I construct transparent counterfactuals for Iran's post-confrontation trajectory from a donor pool of countries with continuously normalized relations with the West. I find large, persistent losses in real GDP and GDP per capita, accompanied by sharp declines in foreign direct investment, trade integration, and non-oil exports. These economic effects coincide with substantial and durable deterioration in political stability, rule of law, and control of corruption. Magnitude calculations imply cumulative output losses comparable to civil-war settings, despite the absence of internal armed conflict. The results highlight confrontation as a deep and persistent economic and institutional shock, extending the literature beyond short-run sanctions effects to sustained geopolitical isolation.

econ.GN↗

arXiv2026

Pricing Catastrophe: How Extreme Political Shocks Reprice Sovereign Risk, Beliefs, and Growth Expectations

Extreme political shocks may reshape economies not only through contemporaneous disruption but by altering beliefs about the distribution of future states. We study how such belief ruptures affect the cost of capital, expectations, and macroeconomic dynamics, using the October 7, 2023 attack on Israel as a precisely timed shock. Leveraging monthly data from 2008 to 2025 and a donor pool of advanced economies, we estimate counterfactual paths using a matrix completion design with rolling-window cross-validation and placebo-based inference, corroborated by synthetic difference-in-differences. We document three core findings. First, long-horizon sovereign risk of Israel is persistently repriced. Ten-year yields and spreads relative to the United States rise sharply and remain elevated. Second, household welfare beliefs deteriorate durably, as reflected in consumer confidence. Third, medium-run momentum improves, captured by a strong rise in the OECD composite leading indicator. These patterns reveal risk-growth decoupling where tail-risk premia rise even as medium-horizon activity expectations strengthen. Our results highlight belief-driven channels as a central mechanism through which extreme ruptures shape macro-financial outcomes.

econ.GN↗

arXiv2025

Assaults on Judicial Independence under the Pretense of Modernization: Evidence from Venezuela

We investigate how government-orchestrated assaults on the judiciary, disguised as modernization efforts, undermine judicial independence. Our study focuses on Venezuela's constitutional overhaul in the early 2000s, initiated by Hugo Ch\'avez and implemented through a judicial emergency committee. We employ a hybrid synthetic control and difference-in-differences approach to estimate the impact of populist attacks on judicial independence trajectories. By comparing Venezuela to a stable pool of countries without radical constitutional changes, our identification strategy isolates the effect of populist assaults from unobservable confounders and common time trends. Our findings reveal that authoritarian interventions lead to an immediate and lasting breakdown of judicial independence. The deterioration in judicial independence vis-\'a-vis the estimated counterfactual is robust to variations in the donor pool composition. It does not appear to be driven by pre-existing judicial changes and withstands numerous temporal and spatial placebo checks across over nine million randomly sequenced donor samples.

econ.GN↗

arXiv2025

The Economic Dividends of Peace: Evidence from Arab-Israeli Normalization

This paper provides the first causal evidence on the long-run economic dividends of Arab-Israeli peace treaties. Using synthetic control and difference-in-differences estimators, we analyze 1978 Camp David Accords and 1994 peace treaty between Jordan and Israel. Both cases reveal large and lasting gains. By 2011, real GDP of Egypt exceeded its synthetic counterfactual by 64 percent, and per capita income by 82 percent. Jordanian trajectory shows similarly permanent improvements, with real GDP higher by 75 percent and per capita income by more than 20 percent. The mechanisms differ: in Egypt, gains stem from a sharp fiscal reallocation together with higher foreign direct investment and improved institutional credibility, while Jordan benefited primarily through enhanced trade and financial inflows. Robustness and placebo tests confirm the uniqueness of these effects. The results demonstrate that peace agreements yield large, durable, and heterogeneous growth dividends.

econ.GN↗

arXiv2025

From Revolution to Ruin: An Empirical Analysis Yemen's State Collapse

We assess the broad repercussions of Yemen's 2011 revolution and subsequent civil war on its macroeconomic trajectories, human development, and quality of governance by constructing counterfactual benchmarks using a balanced panel of 37 developing countries over 1990-2022. Drawing on matrix-completion estimators with alternative shrinkage regimes and a LASSO-augmented synthetic-control method, we generate Yemen's hypothetical no-conflict paths for key macroeconomic aggregates, demographic and health indicators, and governance metrics. Across the full spectrum of methods, the conflict's outbreak corresponds with a dramatic reversal of economic and institutional development. We find that output and income experience an unprecedented contraction, investment and trade openness deteriorate sharply, and gains in life expectancy and human development are broadly reversed. Simultaneously, measures of political accountability, administrative capacity, rule of law, and corruption control collapse, reflecting systemic institutional breakdown. The concordance of results across a variety of empirical strategies attests to the robustness of our estimates.

econ.GN↗

arXiv2025

Revolutions as Structural Breaks: The Long-Term Economic and Institutional Consequences of the 1979 Iranian Revolution

This paper examines whether major political institutional disruptions produce temporary shocks or structural breaks in long-term development. Using the 1979 Iranian Revolution as a natural experiment, we apply the synthetic control method to estimate its causal effect on economic growth and institutional quality. Drawing on a panel of 66 countries from 1950 to 2015, we construct counterfactual trajectories for Iran in the absence of revolutionary change. Our results show a persistent and statistically significant divergence in per capita GDP, institutional quality, and legal constraints on executive power. We perform in-space and in-time placebo tests to rule out confounding events, such as the Iran-Iraq War and international sanctions, and propose confidence interval estimation to address uncertainty in treatment effects. The findings identify the Iranian Revolution as a structural institutional rupture, with implications for the classification of institutional change more broadly. We contribute a generalizable empirical framework for distinguishing between temporary and structural institutional shocks in long-run development.

econ.GN↗

arXiv2025

Ethnic Conflicts, Civil War and Economic Growth: Region-Level Evidence from former Yugoslavia

We investigate the long-term impact of civil war on subnational economic growth across 78 regions in five former Yugoslav republics from 1950 to 2015. Leveraging the outbreak of ethnic tensions and the onset of conflict, we construct counterfactual growth trajectories using a robust region-level donor pool from 28 conflict-free countries. Applying a hybrid synthetic control and difference-in-differences approach, we find that the war in former Yugoslavia inflicted unprecedented regional per capita GDP losses estimated at 38 percent, with substantial regional heterogeneity. The most war-affected regions suffered prolonged and permanent economic declines, while capital cities experienced more transitory effects. Our results are robust to extensive variety of specification tests, placebo analyses, and falsification exercises. Notably, ethnic tensions between Serbs and Croats explain up to 40 percent of the observed variation in economic losses, underscoring the deep and lasting influence of ethnic divisions on economic impacts of the armed conflicts.

econ.GN↗

arXiv2024

Populist Constitutional Backsliding and Judicial Independence: Evidence from Turkiye

The synthetic control method has emerged as a widely utilized empirical tool for estimating the causal effects of public policies, natural disasters, and other interventions on various economic, social, institutional, and political outcomes. In this study, we demonstrate the potential application of this method in empirical comparative law by estimating the impact of the 2010 constitutional referendum in Turkiye on the trajectory of judicial independence. By comparing Turkiye with a salient Mediterranean donor pool of countries that did not experience similar interventions during the period from 1987 to 2021, we provide evidence of a severe breakdown and erosion of judicial independence. This deterioration appears to be a direct response to the populist constitutional backsliding initiated by the government-orchestrated assault on the judiciary, which was carried out under the guise of judicial modernization in 2010, before the additional constitutional reforms in 2017.

econ.GN↗

arXiv2024

Effect of Austerity Measures on Infant Mortality: Evidence from Greece

This study examines the effect of fiscal austerity measures on infant mortality in Greece. Austerity measures were initiated by the tripartite committee and implemented between 2010 and 2017 to counteract deep fiscal deficit and large public debt. By comparing Greece with a plausible donor pool of OECD and Mediterranean member states in the period 1991-2020, we estimate a series of missing counterfactual scenarios to evaluate the infant mortality effects of large-scale reduction in spending on health care. A series of hybrid synthetic control and difference-in-differences estimates indicate a unique and pervasive increase in infant mortality after the implementation of austerity measures. Compared to a plausible OECD and Mediterranean counterfactual scenario, pro-cyclical austerity measures are associated with derailed and permanently increased infant mortality up to the present day. Our estimates suggest that compared to a plausible counterfactual scenario, the cumulative infant mortality cost of austerity policies exceeds 10,000 infant deaths or slightly less than 850 deaths for each year of the austerity policies. Notably, mortality increases are concentrated among boys. The estimated impacts survive a battery of rigorous robustness and placebo tests.

econ.GN↗

arXiv2024

Islamic Law, Western European Law and the Roots of Middle East's Long Divergence: a Comparative Empirical Investigation (800-1600)

We examine the contribution of Islamic legal institutions to the comparative economic decline of the Middle East behind Latin Europe, which can be observed since the late Middle Ages. To this end, we explore whether the sacralization of Islamic law and its focus on the Sharia as supreme, sacred and unchangeable legal text, which reached its culmination in the 13th century had an impact on economic development. We use the population size of 145 cities in Islamic countries and 648 European cities for the period 800-1800 as proxies for the level of economic development, and construct novel estimates of the number of law schools (i.e. madaris) and estimate their contribution to the pre-industrial economic development. Our triple-differences estimates show that a higher density of madrasas before the sacralization of Islamic law predicts a more vibrant urban economy characterized by higher urban growth. After the consolidation of the sharia sacralization of law in the 13th century, greater density of law schools is associated with stagnating population size. We show that the economic decline of the Middle East can be partly explained by the absence of legal innovations or substitutes of them, which paved the way for the economic rise of Latin Europe, where ground-breaking legal reforms introduced a series of legal innovations conducive for economic growth. We find that the number of learned lawyers trained in universities with law schools is highly and positively correlated with the western European city population. Our counterfactual estimates show that almost all Islamic cities under consideration would have had much larger size by the year 1700 if legal innovations comparable to those in Western Europe were introduced. By making use of a series of synthetic control and difference-in-differences estimators our findings are robust against a large number of model specification checks.

econ.GN↗

arXiv2022

Estimating the Effects of Syrian Civil War

We examine the effect of civil war in Syria on economic growth, human development and institutional quality. Building on the synthetic control method, we estimate the missing counterfactual scenario in the hypothetical absence of the armed conflict that led to unprecedented humanitarian crisis and population displacement in modern history. By matching Syrian growth and development trajectories with the characteristics of the donor pool of 66 countries with no armed internal conflict in the period 1996-2021, we estimate a series of growth and development gaps attributed to civil war. Syrian civil war appears to have had a temporary negative effect on the trajectory of economic growth that almost disappeared before the onset of COVID19 pandemic. By contrast, the civil war led to unprecedented losses in human development, rising infant mortality and rampantly deteriorating institutional quality. Down to the present day, each year of the conflict led to 5,700 additional under-five child deaths with permanently derailed negative effect on longevity. The civil war led to unprecedent and permanent deterioration in institutional quality indicated by pervasive weakening of the rule of law and deleterious impacts on government effectiveness, civil liberties and widespread escalation of corruption. The estimated effects survive a battery of placebo checks.

econ.GN↗

arXiv2022

The perils of Kremlin's influence: evidence from Ukraine

We examine the contribution of institutional integration to the institutional quality. To this end, we exploit the 2007 political crisis in Ukraine and examine the effects of staying out of the European Union for 28 Ukrainian provinces in the period 1996-2020. We construct novel subnational estimates of institutional quality for Ukraine and central and eastern European countries based on the latent residual component extraction of institutional quality from the existing governance indicators by making use of Bayesian posterior analysis under non-informative objective prior function. By comparing the residualized institutional quality trajectories of Ukrainian provinces with their central and eastern European peers that were admitted to the European Union in 2004 and after, we assess the institutional quality cost of being under Russian political influence and interference. Based on the large-scale synthetic control analysis, we find evidence of large-scale negative institutional quality effects of staying out of the European Union such as heightened political instability and rampant deterioration of the rule of law and control of corruption. Statistical significance of the estimated effects is evaluated across a comprehensive placebo simulation with more than 34 billion placebo averages for each institutional quality outcome.

econ.GN↗