Journal Article The Reserve Base, Reserve Requirements, and the Equilibrium Rate of Interest: Reply Get access Herschel I. Grossman Herschel I. Grossman Brown University Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 82, Issue 3, August 1968, Pages 504–507, https://doi.org/10.2307/1879521 Published: 01 August 1968

This paper develops a positive theory of insurrections that treats insurrection and its deterrence or suppression as economic activities that compete with production for scarce resources. The general equilibrium analytical framework reveals how the allocation of labor time among insurrection, soldiering, and production and the probabilistic distribution of income between the peasant families and the ruler's clientele both depend on the technology of insurrection. A central result is that equilibria with more time allocated to insurrection and a higher probability of a successful insurrection have lower production and total income but nevertheless can ha e higher expected income for the peasants.