We analyze a game between citizens and governments, whose type (benevolent or predatory) is unknown to the public. Opportunistic governments mix between predation and restraint. As long as restraint is observed, political expectations improve, people enter the modern sector, and the economy...

A model is presented where the ruler may arm the producers, in order to convince them that he will not expropriate them ex post. This sets an upper limit on the tax rate, not higher than their probability of losing their income, should a war occur. The relevance of this analysis is illustrated...