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Applied and bridge studies study record
Public economics, trade & developmentThe Fiscal Capture Universality Theorem: When Government Revenue Dependency Blocks Structural Reform
STATUS · Manuscript in progressSSRN · Not yet posted
MECHANISM
Identify the incentive structure and the condition that would falsify the claim.
RULE CHANGE
Read the intervention only after the paper shows how the current payoff space fails to support system welfare.
READER USE
Use the summary to see where private gain creates system exposure, then check the study record.
Contribution — what this adds to the conversation
Provides formal theorem, calibration, and escape condition (revenue-neutral reform). Integrates with MST, Decision Accounting, and Game-Change theorems.
WHAT'S NEW · First formal distinction between regulatory and fiscal capture; proves existence of φ* threshold and universality across 58 ranked revenue-ratio domains. Extends Stigler-Peltzman, rentier state theory, and credible commitment literature.
The paper introduces the Fiscal Capture Universality Theorem, proving that when a government derives a material fraction of revenue from a welfare-destroying industry, it cannot credibly commit to reform. The mechanism is arithmetic, not lobbying. The theorem identifies a threshold φ between 10-25% of industry revenue, above which reform is structurally impossible. All 61 SAPM domains create fiscal-capture channels, with 35+ exceeding φ in at least one jurisdiction. The escape condition is revenue-neutral reform.