Professor Jeffrey B. Nugent, University of Southern California, leads a collaborative research project on New Institutional Economics (NIE) and Economic Development in Tunisia involving scholars at the University of Southern California and the University of Tunis, Tunisia. His main collaborator is Professor Mustapha K. Nabli, who heads the project's counterpart group at the Economics Department, University of Tunis. NIE analyzes the effect of institutions on economic behavior and explains why institutions change over time, whereas traditional economic theory overlooks institutions. Considering the influence of institutions in economic analysis leads to different conclusions compared to other forms of analysis and NIE has changed interpretations of findings in macroeconomics, labor economics, health insurance, military procurement, and other economic topics. NIE is especially useful in situations where institutional change is likely to be an important factor in drawing economic conclusions, such as in developing countries. Despite its potential, NIE has not been greatly used to describe the economics of developing countries. This is the topic of interest for Dr. Nugent's and Dr. Nabli's group, and they have done several studies in Tunisia. The country offers good case material for NIE analysis, because of its changing institutional structures. The two research groups have exchanged graduate students and research visits for several years. The support from this award will allow the researchers to come together to synthesize the results of their past work and to plan their next steps. The award will fund visits of the American researchers to a meeting in Tunis with their Tunisian counterparts and return visits by Tunisians to the University of Southern California. Drs. Nugent and Nabli plan to publish a volume summarizing their work and to prepare articles on specific topics. The proposed cooperation allows the U.S. investigators to use data sources abroad that are not easily available to them in the U.S.
