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Institutional Stickiness and the New Development Economics

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Author Info
Peter J. Boettke
Christopher J. Coyne
Peter T. Leeson

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Abstract

Research examining the importance of path dependence and culture for institutions and development tells us that "history matters," but not "how" history matters. To provide this missing "how," we provide a framework for understanding institutional "stickiness" based on the regression theorem. The regression theorem maintains that the stickiness, and therefore likely success, of any proposed institutional change is a function of that institution's status in relationship to indigenous agents in the previous time period. This framework for analyzing institutional stickiness creates the core of what we call the New Development Economics. Historical cases of postwar reconstruction and transition efforts provide evidence for our claim. Copyright © 2008 American Journal of Economics and Sociology, Inc..

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Article provided by Blackwell Publishing in its journal American Journal of Economics and Sociology.

Volume (Year): 67 (2008)
Issue (Month): 2 (04)
Pages: 331-358
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Handle: RePEc:bla:ajecsc:v:67:y:2008:i:2:p:331-358

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  1. Claudia Williamson, 2009. "Informal institutions rule: institutional arrangements and economic performance," Public Choice, Springer, vol. 139(3), pages 371-387, June. [Downloadable!] (restricted)
  2. Art Carden, 2009. "Inputs and institutions as conservative elements," The Review of Austrian Economics, Springer, vol. 22(1), pages 1-19, March. [Downloadable!] (restricted)
  3. David Skarbek, 2009. "Alertness, local knowledge, and Johnny Appleseed," The Review of Austrian Economics, Springer, vol. 22(4), pages 415-424, December. [Downloadable!] (restricted)
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