IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Institutional changes: Alternative theories and consequences for institutional design

  • Brousseau, Eric
  • Garrouste, Pierre
  • Raynaud, Emmanuel

This paper surveys alternative approaches to the emergence and evolution of institutions. The challenge is to develop frameworks capable of capturing both stability and change. We follow a "descaling" approach to show how founding assumptions about economics--namely, alternative assumptions about individual rationality and the role of social efficiency--influence our understanding of the drivers of institutional evolution. We then contrast two families of institutional theory. In the first, institutions are viewed as rules imposed on individuals and the focus is on the strategic games among coalitions that aim to promote or block new rules. In the second, institutions are viewed as shared beliefs; here the idea is to analyze how equilibria that are self-enforcing (in terms of mutual expectations about others' behaviors) can collapse and so induce switching to another equilibrium. Finally, we discuss the political economy literature that examines institutional transitions to a market economy, and we identify long-term drivers as well as short-term political barriers to institutional reforms.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.sciencedirect.com/science/article/pii/S0167268111000552
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Elsevier in its journal Journal of Economic Behavior & Organization.

Volume (Year): 79 (2011)
Issue (Month): 1-2 (June)
Pages: 3-19

as
in new window

Handle: RePEc:eee:jeborg:v:79:y:2011:i:1-2:p:3-19
Contact details of provider: Web page: http://www.elsevier.com/locate/jebo

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Hadfield, Gillian K., 2008. "The levers of legal design: Institutional determinants of the quality of law," Journal of Comparative Economics, Elsevier, vol. 36(1), pages 43-73, March.
  2. Aoki, Masahiko, 2010. "Corporations in Evolving Diversity: Cognition, Governance, and Institutions," OUP Catalogue, Oxford University Press, number 9780199218530, March.
  3. Leonid Hurwicz, 2008. "But Who Will Guard the Guardians?," American Economic Review, American Economic Association, vol. 98(3), pages 577-85, June.
  4. Binmore, Ken, 2010. "Game theory and institutions," Journal of Comparative Economics, Elsevier, vol. 38(3), pages 245-252, September.
  5. Lawrence J. Lau & Yingyi Qian & Gerard Roland, . "Pareto-Improving Economic Reforms through Dual-Track Liberalization," Working Papers 97007, Stanford University, Department of Economics.
  6. Masahiko Aoki, 2001. "Toward a Comparative Institutional Analysis," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262011875, June.
  7. Giavazzi, Francesco & Tabellini, Guido, 2005. "Economic and political liberalizations," Journal of Monetary Economics, Elsevier, vol. 52(7), pages 1297-1330, October.
  8. Raynaud, Emmanuel & Brousseau, Eric, 2011. "“Climbing the hierarchical ladders of rules”: A life-cycle theory of institutional evolution," Economics Papers from University Paris Dauphine 123456789/7081, Paris Dauphine University.
  9. Lewis, Tracy R. & Feenstra, Robert & Ware, Roger, 1989. "Eliminating price supports : A political economy perspective," Journal of Public Economics, Elsevier, vol. 40(2), pages 159-185, November.
  10. Djankov, Simeon & Glaeser, Edward & La Porta, Rafael & Lopez de Silanes, Florencio & Shleifer, Andrei, 2003. "The new comparative economics," Policy Research Working Paper Series 3054, The World Bank.
  11. Mathias Dewatripont, 1992. "Economic Reform and Dynamic Political Constraints," ULB Institutional Repository 2013/175991, ULB -- Universite Libre de Bruxelles.
  12. Torsten Persson & Guido Tabellini, 2004. "Constitutions and Economic Policy," Journal of Economic Perspectives, American Economic Association, vol. 18(1), pages 75-98, Winter.
  13. David, Paul A, 1985. "Clio and the Economics of QWERTY," American Economic Review, American Economic Association, vol. 75(2), pages 332-37, May.
  14. Geoffrey M. Hodgson, 1998. "The Approach of Institutional Economics," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 166-192, March.
  15. Dewatripont, M & Roland, G, 1992. "The Virtues of Gradualism and Legitimacy in the Transition to a Market Economy," Economic Journal, Royal Economic Society, vol. 102(411), pages 291-300, March.
  16. repec:lmu:muenar:20003 is not listed on IDEAS
  17. Bernd Hayo & Stefan Voigt, 2010. "Determinants of Constitutional Change: Why do Countries Change their Form of Governments?," CESifo Working Paper Series 3087, CESifo Group Munich.
  18. Kingston, Christopher, 2007. "Marine Insurance in Britain and America, 1720 1844: A Comparative Institutional Analysis," The Journal of Economic History, Cambridge University Press, vol. 67(02), pages 379-409, June.
  19. G�rard Roland, 2002. "The Political Economy of Transition," Journal of Economic Perspectives, American Economic Association, vol. 16(1), pages 29-50, Winter.
  20. Mathias Dewatripont & Gérard Roland, 1995. "The design of reform packages under uncertainty," ULB Institutional Repository 2013/9607, ULB -- Universite Libre de Bruxelles.
  21. Sugden, Robert, 2011. "Salience, inductive reasoning and the emergence of conventions," Journal of Economic Behavior & Organization, Elsevier, vol. 79(1), pages 35-47.
  22. Daron Acemoglu & Davide Cantoni & Simon Johnson & James A. Robinson, 2011. "The Consequences of Radical Reform: The French Revolution," American Economic Review, American Economic Association, vol. 101(7), pages 3286-3307, December.
  23. Dani Rodrik, 1993. "Trade and Industrial Policy Reform in Developing Countries: A Review of Recent Theory and Evidence," NBER Working Papers 4417, National Bureau of Economic Research, Inc.
  24. H. Peyton Young, 1996. "The Economics of Convention," Journal of Economic Perspectives, American Economic Association, vol. 10(2), pages 105-122, Spring.
  25. Pierre-André Chiappori, 1984. "Sélection naturelle et rationalité absolue des entreprises," Revue Économique, Programme National Persée, vol. 35(1), pages 87-108.
  26. Mariano Tommasi & Pablo T. Spiller, 2000. "The Institutional Foundations of Public Policy: A Transactions Approach with Application to Argentina," Working Papers 29, Universidad de San Andres, Departamento de Economia, revised May 2000.
  27. Arthur T. Denzau & Douglass C. North, 1993. "Shared Mental Models: Ideologies and Institutions," Economic History 9309003, EconWPA.
  28. Sugden, Robert, 1989. "Spontaneous Order," Journal of Economic Perspectives, American Economic Association, vol. 3(4), pages 85-97, Fall.
  29. Dari-Mattiacci, Giuseppe & Deffains, Bruno & Lovat, Bruno, 2011. "The dynamics of the legal system," Journal of Economic Behavior & Organization, Elsevier, vol. 79(1), pages 95-107.
  30. Roland Bénabou & Jean Tirole, 2007. "Identity, Dignity and Taboos: Beliefs as Assets," Carlo Alberto Notebooks 50, Collegio Carlo Alberto.
  31. David N. DeJong & Daniel Berkowitz, 2008. "Growth in Post-Soviet Russia: A Tale of Two Transitions," Working Papers 369, University of Pittsburgh, Department of Economics, revised Sep 2008.
  32. Jean Tirole & Roland Bénabou, 2006. "Incentives and Prosocial Behavior," American Economic Review, American Economic Association, vol. 96(5), pages 1652-1678, December.
  33. Hadfield, Gillian K., 2011. "The dynamic quality of law: The role of judicial incentives and legal human capital in the adaptation of law," Journal of Economic Behavior & Organization, Elsevier, vol. 79(1-2), pages 80-94, June.
  34. Sharun Mukand & Dani Rodrik, 2002. "In Search of the Holy Grail: Policy Convergence, Experimentation, and Economic Performance," NBER Working Papers 9134, National Bureau of Economic Research, Inc.
  35. Acemoglu, Daron, 2003. "Why not a political Coase theorem? Social conflict, commitment, and politics," Journal of Comparative Economics, Elsevier, vol. 31(4), pages 620-652, December.
  36. Rodrik, Dani, 2008. "Second-Best Institutions," CEPR Discussion Papers 6764, C.E.P.R. Discussion Papers.
  37. Shang-Jin Wei, 1997. "Gradualism versus Big Bang: Speed and Sustainability of Reforms," Canadian Journal of Economics, Canadian Economics Association, vol. 30(4), pages 1234-47, November.
  38. Éric Brousseau, 2000. "Processus évolutionnaires et institutions. Quelles alternatives à la rationalité parfaite ?," Revue Économique, Programme National Persée, vol. 51(5), pages 1185-1213.
  39. McAdams, Richard H. & Rasmusen, Eric B., 2007. "Norms and the Law," Handbook of Law and Economics, Elsevier.
  40. Liebowitz, S J & Margolis, Stephen E, 1995. "Path Dependence, Lock-in, and History," Journal of Law, Economics and Organization, Oxford University Press, vol. 11(1), pages 205-26, April.
  41. Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 2007. "The Economic Consequences of Legal Origins," NBER Working Papers 13608, National Bureau of Economic Research, Inc.
  42. Petros Sekeris & Jean-Philippe Platteau, 2010. "On the Feasibility of Power and Status Ranking in Traditional Setups," Post-Print halshs-00122421, HAL.
  43. Hadfield, Gillian K., 2011. "The dynamic quality of law: The role of judicial incentives and legal human capital in the adaptation of law," Journal of Economic Behavior & Organization, Elsevier, vol. 79(1), pages 80-94.
  44. Greif, Avner & Tadelis, Steven, 2010. "A theory of moral persistence: Crypto-morality and political legitimacy," Journal of Comparative Economics, Elsevier, vol. 38(3), pages 229-244, September.
  45. Leonid Hurwicz, 1994. "Economic design, adjustment processes, mechanisms, and institutions," Review of Economic Design, Springer, vol. 1(1), pages 1-14, December.
  46. Geroski, Paul A, 1999. "Models of Technology Diffusion," CEPR Discussion Papers 2146, C.E.P.R. Discussion Papers.
  47. Demsetz, Harold, 1969. "Information and Efficiency: Another Viewpoint," Journal of Law and Economics, University of Chicago Press, vol. 12(1), pages 1-22, April.
  48. Guerriero, C., 2009. "Democracy, Judicial Attitudes and Heterogeneity: The Civil Versus Common Law Tradition," Cambridge Working Papers in Economics 0917, Faculty of Economics, University of Cambridge.
  49. Svensson, Jakob, 1998. "Investment, property rights and political instability: Theory and evidence," European Economic Review, Elsevier, vol. 42(7), pages 1317-1341, July.
  50. Grossman, Gene M & Helpman, Elhanan, 1996. "Electoral Competition and Special Interest Politics," Review of Economic Studies, Wiley Blackwell, vol. 63(2), pages 265-86, April.
  51. McCubbins, Mathew D & Noll, Roger G & Weingast, Barry R, 1987. "Administrative Procedures as Instruments of Political Control," Journal of Law, Economics and Organization, Oxford University Press, vol. 3(2), pages 243-77, Fall.
  52. Dollar, David & Svensson, Jakob, 1998. "What explains the success or failure of structural adjustment programs?," Policy Research Working Paper Series 1938, The World Bank.
  53. S. J. Liebowitz & Stephen E. Margolis, 1994. "Network Externality: An Uncommon Tragedy," Journal of Economic Perspectives, American Economic Association, vol. 8(2), pages 133-150, Spring.
  54. Armen A. Alchian, 1950. "Uncertainty, Evolution, and Economic Theory," Journal of Political Economy, University of Chicago Press, vol. 58, pages 211.
  55. Daron Acemoglu & Simon Johnson, 2005. "Unbundling Institutions," Journal of Political Economy, University of Chicago Press, vol. 113(5), pages 949-995, October.
  56. Arrunada, Benito & Garoupa, Nuno, 2005. "The Choice of Titling System in Land," Journal of Law and Economics, University of Chicago Press, vol. 48(2), pages 709-27, October.
  57. Hodgson, Geoffrey M. & Knudsen, Thorbjorn, 2004. "The complex evolution of a simple traffic convention: the functions and implications of habit," Journal of Economic Behavior & Organization, Elsevier, vol. 54(1), pages 19-47, May.
  58. Barro, Robert J., 1999. "Determinants of Democracy," Scholarly Articles 3451297, Harvard University Department of Economics.
  59. Jellema, Jon & Roland, Gerard, 2011. "Institutional clusters and economic performance," Journal of Economic Behavior & Organization, Elsevier, vol. 79(1), pages 108-132.
  60. Daron Acemoglu & James A. Robinson, 2006. "De Facto Political Power and Institutional Persistence," American Economic Review, American Economic Association, vol. 96(2), pages 325-330, May.
  61. Arthur, W Brian, 1989. "Competing Technologies, Increasing Returns, and Lock-In by Historical Events," Economic Journal, Royal Economic Society, vol. 99(394), pages 116-31, March.
  62. Samuel Bowles, 1998. "Endogenous Preferences: The Cultural Consequences of Markets and Other Economic Institutions," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 75-111, March.
  63. Francisco José Veiga, 2000. "Delays of Inflation Stabilizations," Economics and Politics, Wiley Blackwell, vol. 12(3), pages 275-295, November.
  64. Roger Myerson, 2009. "Fundamental theory of institutions: a lecture in honor of Leo Hurwicz," Review of Economic Design, Springer, vol. 13(1), pages 59-75, April.
  65. McMillan, John & Naughton, Barry, 1992. "How to Reform a Planned Economy: Lessons from China," Oxford Review of Economic Policy, Oxford University Press, vol. 8(1), pages 130-43, Spring.
  66. Douglass C. North, 2005. "Introduction to Understanding the Process of Economic Change
    [Understanding the Process of Economic Change]
    ," Introductory Chapters, Princeton University Press.
  67. repec:cai:recosp:reco_p2000_51n5_1185 is not listed on IDEAS
  68. Oliver E. Williamson, 2000. "The New Institutional Economics: Taking Stock, Looking Ahead," Journal of Economic Literature, American Economic Association, vol. 38(3), pages 595-613, September.
  69. Grajzl Peter & Dimitrova-Grajzl Valentina, 2009. "The Choice in the Lawmaking Process: Legal Transplants vs. Indigenous Law," Review of Law & Economics, De Gruyter, vol. 5(1), pages 615-660, November.
  70. Avinash Dixit, 2009. "Governance Institutions and Economic Activity," American Economic Review, American Economic Association, vol. 99(1), pages 5-24, March.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:eee:jeborg:v:79:y:2011:i:1-2:p:3-19. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.