The Soft Budget Constraint: An Institutionalist Approach
In this paper, we reconsider the concept of the BC in the light of an institutionalist approach. Kornai’s interpretation of the concept provides the basis of such an approach. He defines the BC as a conditional empirical fact regarding the specific behavioural regularity of agents that is determined by particular institutional setups. Different degrees of budget constraint (ranging from a SBC to a HBC) are thus considered as empirical facts exogenously given in different institutional contexts. In this perspective, the BC is related to the survival behaviour of boundedly rational (satisficing) agents. It implies neither market equilibrium nor optimality.
|Date of creation:||09 Nov 2002|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC
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.:
- Kornai, J, 1979. "Resource-Constrained versus Demand-Constrained Systems," Econometrica, Econometric Society, vol. 47(4), pages 801-19, July.
- Kornai, Janos, 1992. "The Socialist System: The Political Economy of Communism," OUP Catalogue, Oxford University Press, number 9780198287766, March.
- Kornai, Janos, 1986.
"The Soft Budget Constraint,"
Wiley Blackwell, vol. 39(1), pages 3-30.
- Mankiw, N. Gregory, 1992.
"The reincarnation of Keynesian economics,"
European Economic Review,
Elsevier, vol. 36(2-3), pages 559-565, April.
- Mankiw, N.G., 1991. "The Reincarnation of Keynesian Economoics," Harvard Institute of Economic Research Working Papers 1572, Harvard - Institute of Economic Research.
- N. Gregory Mankiw, 1991. "The Reincarnation of Keynesian Economics," NBER Working Papers 3885, National Bureau of Economic Research, Inc.
- Schaffer, Mark E., 1998. "Do Firms in Transition Economies Have Soft Budget Constraints? A Reconsideration of Concepts and Evidence," Journal of Comparative Economics, Elsevier, vol. 26(1), pages 80-103, March.
- Dewatripont, M & Maskin, E, 1995.
"Credit and Efficiency in Centralized and Decentralized Economies,"
Review of Economic Studies,
Wiley Blackwell, vol. 62(4), pages 541-55, October.
- Mathias Dewatripont & Eric Maskin, 1995. "Credit and efficiency in centralized and decentralized economies," ULB Institutional Repository 2013/9603, ULB -- Universite Libre de Bruxelles.
- Mathias Dewatripont & Eric Maskin, 2004. "Credit and efficiency in centralized and decentralized economies," ULB Institutional Repository 2013/9605, ULB -- Universite Libre de Bruxelles.
- Becker, Gary S, 1983. "A Theory of Competition among Pressure Groups for Political Influence," The Quarterly Journal of Economics, MIT Press, vol. 98(3), pages 371-400, August.
- Mehrdad VAHABI, 2001.
"The Soft Budget Constraint : A Theoretical Clarification,"
Discussion Papers (REL - Recherches Economiques de Louvain)
2001024, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
- Mehrdad Vahabi, 2001. "The Soft Budget Constraint: A Theoretical Clarification," Post-Print hal-00629160, HAL.
- Okun, Arthur M, 1980. "Rational-Expectations-with-Misperceptions as a Theory of the Business Cycle," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 12(4), pages 817-25, November.
- Raiser, Martin, 1994. "The no-exit economy: Soft budget constraints and the fate of economic reforms in developing countries," World Development, Elsevier, vol. 22(12), pages 1851-1867, December.
- Kaldor, Nicholas, 1972. "The Irrelevance of Equilibrium Economics," Economic Journal, Royal Economic Society, vol. 82(328), pages 1237-55, December.
- Kornai, Janos & Weibull, Jorgen W., 1983. "Paternalism, buyers' and sellers' market," Mathematical Social Sciences, Elsevier, vol. 6(2), pages 153-169, November.
- Michael Keren, 1993. "On the (Im)possibility of Market Socialism," Eastern Economic Journal, Eastern Economic Association, vol. 19(3), pages 333-344, Summer.
- Kornai, Janos, 2001. "Hardening the budget constraint: The experience of the post-socialist countries," European Economic Review, Elsevier, vol. 45(9), pages 1573-1599, October.
- Shleifer, Andrei & Vishny, Robert W, 1994. "Politicians and Firms," The Quarterly Journal of Economics, MIT Press, vol. 109(4), pages 995-1025, November.
- Vahabi, Mehrdad, 1998. "The Relevance of the Marshallian Concept of Normality in Interior and Inertial Dynamics as Revisited by Shackle and Kornai," Cambridge Journal of Economics, Oxford University Press, vol. 22(5), pages 547-72, September.
- J. Kornai, 1998. "Legal Obligation, Non-Compliance and Soft Budget Constraint," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 9.
- Szabo, Judit, 1988. " Preliminary and Incremental Softness of the Budget Constraint: A Comment on the Gomulka-Kornai Debate," Economic Change and Restructuring, Springer, vol. 22(3), pages 109-16.
- Herbert A. Simon, 1991. "Organizations and Markets," Journal of Economic Perspectives, American Economic Association, vol. 5(2), pages 25-44, Spring.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:17649. 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: (Ekkehart Schlicht)
If references are entirely missing, you can add them using this form.