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Limited access orders in the developing world :a new approach to the problems of development

Author

Listed:
  • North, Douglass C.
  • Wallis, John Joseph
  • Webb, Steven B.
  • Weingast, Barry R.

Abstract

The upper-income, advanced industrial countries of the world today all have market economies with open competition, competitive multi-party democratic political systems, and a secure government monopoly over violence. Such open access orders, however, are not the only norm and equilibrium type of society. The middle and low-income developing countries today, like all countries before about 1800, can be understood as limited access orders that maintain their equilibrium in a fundamentally different way. In limited access orders, the state does not have a secure monopoly on violence, and society organizes itself to control violence among the elite factions. A common feature of limited access orders is that political elites divide up control of the economy, each getting some share of the rents. Since outbreaks of violence reduce the rents, the elite factions have incentives to be peaceable most of the time. Adequate stability of the rents and thus of the social order requires limiting access and competition-hence a social order with a fundamentally different logic than the open access order. This paper lays out such a framework and explores some of its implications for the problems of development today.

Suggested Citation

  • North, Douglass C. & Wallis, John Joseph & Webb, Steven B. & Weingast, Barry R., 2007. "Limited access orders in the developing world :a new approach to the problems of development," Policy Research Working Paper Series 4359, The World Bank.
  • Handle: RePEc:wbk:wbrwps:4359
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    Cited by:

    1. Ofer, Gur, 2010. "Twenty Years Later and the Socialist Heritage is still Kicking: the Case of Russia," WIDER Working Paper Series 059, World Institute for Development Economic Research (UNU-WIDER).
    2. Ahmed, Faisal Z. & Greenleaf, Anne & Sacks, Audrey, 2014. "The Paradox of Export Growth in Areas of Weak Governance: The Case of the Ready Made Garment Sector in Bangladesh," World Development, Elsevier, vol. 56(C), pages 258-271.
    3. World Bank, 2015. "Republic of Yemen," World Bank Other Operational Studies 23660, The World Bank.
    4. Dan Schwab & Eric Werker, 2014. "Profits and Economic Development," Harvard Business School Working Papers 14-087, Harvard Business School.
    5. Baskaran, Thushyanthan & Bigsten, Arne, 2013. "Fiscal Capacity and the Quality of Government in Sub-Saharan Africa," World Development, Elsevier, vol. 45(C), pages 92-107.
    6. Will, Matthias Georg & Hielscher, Stefan, 2013. "How do companies invest in corporate social responsibility? An ordonomic contribution for empirical CSR research," Discussion Papers 2013-3, Martin Luther University of Halle-Wittenberg, Chair of Economic Ethics.
    7. Will, Matthias Georg & Hielscher, Stefan, 2012. "How do companies invest in corporate social responsibility? An ordonomic contribution for empirical CSR research," Discussion Papers 2012-2, Martin Luther University of Halle-Wittenberg, Chair of Economic Ethics.
    8. repec:ilo:ilowps:487627 is not listed on IDEAS
    9. repec:sgh:gosnar:y:2016:i:6:p:115-135 is not listed on IDEAS
    10. Jürgen Matthes & Bodo Herzog & Holger Schmieding & Erlei. Mathias, 2012. "Staatsbankrotte, Umschuldungen oder fortgesetzte Hilfen: Wie hoch sind die Kosten dieser Alternativen, und was können sie bewirken?," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 65(07), pages 03-20, April.
    11. Dauvin, Magali & Guerreiro, David, 2017. "The Paradox of Plenty: A Meta-Analysis," World Development, Elsevier, vol. 94(C), pages 212-231.
    12. Baliki, Ghassan & Brück, Tilman & Ferguson, Neil T.N. & Kebede, Sindu W., 2017. "Micro-Foundations of Fragility: Concepts, Measurement and Application," IZA Discussion Papers 11188, Institute for the Study of Labor (IZA).
    13. Tom Lavers & Sam Hickey, 2015. "Investigating the political economy of social protection expansion in Africa: At the intersection of transnational ideas and domestic politics," Global Development Institute Working Paper Series esid-047-15, GDI, The University of Manchester.
    14. Laura Routley, 2012. "Developmental states: a review of the literature," Global Development Institute Working Paper Series esid-003-12, GDI, The University of Manchester.
    15. Vladimir Dubrovskiy & Inna Golodniuk & Janusz Szyrmer, 2009. "Composite Leading Indicators for Ukraine: An Early Warning Model," CASE Network Reports 0085, CASE-Center for Social and Economic Research.
    16. Mundaca, Gabriela, 2017. "Energy subsidies, public investment and endogenous growth," Energy Policy, Elsevier, vol. 110(C), pages 693-709.
    17. Mirza Hassan, 2013. "Political settlement dynamics in a limited-access order: The case of Bangladesh," Global Development Institute Working Paper Series esid-023-13, GDI, The University of Manchester.
    18. Nick Manning & Joanna Watkins, 2013. "Targeting Results, Diagnosing the Means," World Bank Other Operational Studies 25488, The World Bank.

    More about this item

    Keywords

    Corporate Law; Labor Policies; Public Sector Corruption&Anticorruption Measures; E-Business; Disability;

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