Normative reasoning within the mainstream economic framework has been largely shaped by utilitarian ethics. The growing popularity of effective altruism indicates that the utilitarian spirit has also permeated the sphere of social sentiment, evaluating our pro-social behaviour and charitable giving in terms of efficiency. The present study assesses the appropriateness of judging social outcomes through the prism of allocative efficiency by questioning to what extent the society of effective altruists is robust, sustainable, and resilient. Using computer simulations based on the dictator game, we demonstrate that a society of welfare-maximising effective altruists can achieve an optimal outcome alongside equality under extremely restrictive assumptions, such as the uniformity of giving strategies (i.e. interacting with other effective altruists exclusively) and initial equality of wealth distribution. Yet, in the world of unequal opportunities, utilitarian giving tends to increase wealth disparity. In addition, in polymorphic societies, effective altruists underperform compared to deontological (or unconditional) altruists. Consequently, we demonstrate that striving for allocative efficiency might undermine the equality and resilience objectives and question whether the former should remain the dominant economic normative principle.

Using information from all International Monetary Fund conditionality programmes from 1990 to 2018, we implement a dynamic Augmented Inverse Probability Weighting Regression Adjustment approach to enquire whether public-sector employment retrenchment may be incompatible with the goal of shrinking the informal economy. The estimated effect 5 years after the policy intervention indicates an increase in the share of the shadow economy to GDP by about 1.3 percentage points. More importantly, this change involves a sizable reallocation of private economic activity from its formal to its informal part; that is, the size of the formal private sector relative to the size of the informal sector decreases by seven percentage points. We interpret these findings through a two-sector model in which there is interdependence between worker incomes and the allocation of product demand across the formal and informal sectors.

Recently, scholars have advanced an ideal of the entrepreneurial state in which industrial policy is pursued in a mission-directed manner. Crucially, this perspective does not merely call for the heavier use of industrial policy, but envisions the state as a central focal point, mobilising society around the pursuit of a common mission. Using the historical example of East Asia's developmental state, which closely resembles its contemporary variant, I demonstrate that mission-directionality – should it be consistently applied – tends towards the pursuit of a singular overarching mission, and could require the use of authoritarian and disciplinary mechanisms to sustain mission focus in an environment of uncertainty. In turn, this potential risk arises because mission-directionality seeks to transcend the otherwise directionless nature of market-based and democratic decision-making through the use of bureaucratic discretion, to align the behaviour of social actors in a cohesive and directional manner.

Grounded in Hofstede cultural dimensions theory, we examine how informal institutional factors shape cross-country venture capital (VC) flows. Separating VC activity into flows, our method studies how an increment in inflows supports ventures, and an increment in outflows more investing activity. Results suggest that (1) uncertainty avoidance negatively affects investors and ventures (the last with a larger effect), (2) individualistic attitudes equally support both investors and ventures, and (3) a higher level of power distance contributes to a larger private investors sector, an effect that is greater under strong formal institutions (FIs). Effects of masculinity, long-term orientation, and indulgence are inconclusive. Results are robust to various specifications, use of instruments, and endogeneity treatments. The implication is that the optimal characteristics of informal institutions for fostering VC activity differ depending on the level of FIs, as both institutions interact to affect both investors and ventures.