It is often argued that governments take advantage of extreme events to expand their power to the detriment of the political opposition and citizens at large. Violations of constitutional constraints are a clear indication of such opportunistic behaviour. We study whether natural disasters, conflicts and other extreme events systematically diminish governments' compliance with constitutional constraints. Our results indicate that governments are most likely to overstep their competences or disregard their responsibilities during civil conflicts, at the onset of international sanctions or following successful coups d’état. Interestingly, Cold War interventions by the United States that installed or supported a political leader led to a decrease in constitutional compliance in the target country, whereas Soviet interventions had no such effect. In contrast, banking crises and natural disasters, which threaten societies at large, but not necessarily the political elite, do not cause a significant decline in constitutional compliance.

James Buchanan was a fervent advocate of a non-discriminatory politics. However, he translated his views on constitutional political economy into (de jure) constitutional design in an insufficiently thoughtful way. Simply writing non-discriminatory politics into a Constitution is unlikely to have the desired effect. All Constitutional language is open to interpretation and political entrepreneurs will be ready to push interpretation in their favoured directions. The history of US Constitutional law bears this out. This does not necessarily discount Buchanan's quest for constitutionalized non-discriminatory politics. However, it does mean that it must be tempered by realistic concerns regarding constitutional design. With this in mind, I suggest that focusing on procedural, rather than substantive, Constitutional provisions may be more fruitful.

This paper assesses how to quantitatively classify countries as conforming to the ideal of an ‘open access order’ in the spirit of Douglass North, John Joseph Wallis, and Barry Weingast's Violence and Social Orders. It does so by taking the harmonic mean of already existing measures of economic freedom, liberal democracy, and state capacity. Thirty-five countries out of 161 in 2020 were assessed to be open access orders. A main dataset is constructed for the years 1950 to present, and a supplementary dataset for select countries is constructed for years back to 1850. Switzerland has the highest index score for open access orders in 2020, is classified to be an open access order continuously since 1950, and is the first country to be classified as an open access order (in 1875).

We argue that the effectiveness of Rwandan governments, both at implementing the 1994 genocide and inducing the current growth miracle, illustrates that the state has high capacity. Yet this capacity is not captured by conventional Weberian concepts, with their focus on taxation and formal bureaucracy. Rather, the capacity of Rwanda's state relies on its ability to leverage dense social networks which connect it to society. The origins of these networks lie in the construction of the historical state which expanded by merging with local lineages and kinship groups. Using data on the historical expansion of the Rwandan state as a proxy for the strength of state–society social networks we show they are uncorrelated with measures of Weberian state capacity. In a fieldwork exercise, we show that rule compliance today is positively correlated with our proxy, but uncorrelated with Weberian state capacity.

This article understands contemporary austerity through historical comparisons informed by Marxist insights into the nature of the state. It argues that austerity policies make sense from the perspective of capital–labour, inter-capitalist and international competition. Differences among states over time, in terms of their size and international situation and contested domestic relations, produce varied imperatives towards austerity and prospects of effective resistance.

Eurozone economies were the most adversely affected by the Global Financial Crisis, with forecast macroeconomic outcomes still highly uncertain. This article argues first that the Eurozone policy framework can be viewed as neo-liberalism overlaid with policy constraints associated with a mis-specified Optimum Currency Area. We are critical of this framework since it is incompatible with the policy sovereignty that is experienced, if not utilised, by sovereign economies such as the USA, UK and Australia. Second, recent and proposed policy reforms which generally lie within the constraints of the Eurozone framework are examined. We conclude that these policies are piecemeal and fail to restore policy sovereignty, which ultimately requires that member countries exit the Eurozone. Key issues associated with such an exit are briefly discussed.

This article considers the political economy of the Productivity Commission in industrial relations reform; in particular, its review of the industrial relations framework foreshadowed in 2013 and conducted in 2015. Following a history of the establishment of the Productivity Commission and its predecessor agencies, it argues that the concepts of third-party independence and third-party endorsement are important for understanding the role of the Productivity Commission. A review of the politics of industrial relations reform leads into the central analysis of the political economy of the Productivity Commission’s 2015 inquiry into the Australian workplace relations framework. The concepts of third-party independence and endorsement are applied in analysing some of the inquiry’s key recommendations. The conclusion discusses several difficulties in the political economy of the Productivity Commission and its relationships to government and, indeed, to evidence, when the latter contradicted its mainly liberal market stance.

This article deals with the rehabilitation of economies in post-conflict states, paying particular attention to the role played by the state in this process. Using the example of Cambodia and its policies on rice production and export, the article shows the prominent role that may be played by the state in prioritised areas of economic development where there has been market failure. In the Cambodian case, the government targeted rice production and export as these had great potential for promoting the major aims of national development policy – economic growth and poverty alleviation. Using a whole-of-government approach and a combination of direct involvement and the creation of an enabling environment, the government appears to have contributed to vastly increased rice production and export.

How stable are democracies? Building on Ghosal and Proto (2009, Journal of Public Economics, 93, 1078–1089), the conditions under which democracies are stable are analyzed. How these conditions relate to the threat of the rise of right wing populism poses to democracies is discussed.

Institutional economists have analyzed permissionless blockchains as a novel institutional building block for voluntary economic exchange and distributed governance, with their unique protocol features such as automated contract execution, high levels of network and process transparency, and uniquely distributed governance. But such institutional analysis needs to be complemented by polycentric analysis of how blockchains change. We characterize such change as resulting from internal sources and external sources. Internal sources include constitutional (protocol) design and collective-choice processes for updating protocols, which help coordinate network participants and users. External sources include competitive pressure from other cryptocurrency networks. By studying two leading networks, Bitcoin and Ethereum, we illustrate how conceptualizing blockchains as competing and constitutional polycentric enterprises clarifies their processes of change.

We study the impact of democratic transitions on institutional outcomes. Using an event study method and a sample of 135 countries over the period 1984–2016, we observe that democratic transitions improve institutional outcomes. The effect appears within 3 years after the transition year. The results are robust to alternative definitions of transitions, alternative codings of pre- and post-transition years, and changing the set of control variables. We also find that both full and partial democratizations improve institutional outcomes. Transitions out of military regimes or communist autocracies do not. The effect of democratization depends on GDP per capita, education, and the regularity of the transition. Finally, the evidence suggests that the effect is particularly clear on the corruption, law and order, and military in politics dimensions of the index.

Many years ago, Emmanuel Todd came up with a classification of family types and argued that the historically prevalent family types in a society have important consequences for its economic, political, and social development. Here, we evaluate Todd's most important predictions empirically. Relying on a parsimonious model with exogenous covariates, we find mixed results. On the one hand, authoritarian family types are, in stark contrast to Todd's predictions, associated with increased levels of the rule of law and innovation. On the other hand, and in line with Todd's expectations, communitarian family types are linked to racism, low levels of the rule of law, and late industrialization. Countries in which endogamy is frequently practiced also display an expectedly high level of state fragility and weak civil society organizations.

All law is relatively coarse after its initial implementation as the legislature cannot foresee all contingencies that can arise in the actual application of the law. Therefore, decisions need to be made by street-level administrators as novel and particular circumstances arise. Economists have largely ignored the political science literature on street-level bureaucrats, such as policemen, welfare case managers, or regulatory agents. I present a case study in the context of market entry regulation in Germany. Qualitative and quantitative evidence suggests that bureaucratic discretion exists, that is, administrative actions can be found on different ends of a decision space, and that its effects are potentially large. Administrators do not apply legislation in a uniform manner and we observe a systematically different application of rules across subnational jurisdictions.

There is a broad consensus that state capacity is central to economic and institutional development. But while the concept originated as a tool for macro-historical and comparative analysis, its success has led the term ‘capacity’ to become a default metaphor for discussing the quality of government bureaucracies. This paper discusses the limitations to conceiving of narrower questions of bureaucratic performance and policy implementation through the lens of the broad, aggregate concept of capacity. Whereas capacity refers to bureaucracies' hypothetical potential, this usually differs from their actual actions due to internal information and incentive problems created by bureaucracies' collective nature, and the constraints and uncertainty imposed by their multiple political principals. Capacity is a convenient shorthand term and is appropriate for some purposes, but it achieves this convenience by abstracting away from the mechanisms that determine bureaucratic performance and policy implementation. To advance the study of bureaucratic quality, researchers should seek to understand the implications of bureaucracies' collective nature, engage with contextual specificity and contingency in policy implementation, and focus measurement and reform efforts more towards actual performance than hypothetical capacity.

The exploitation of radio-electric spectrum bands for wireless transmission purposes has some features of the commons: it is subject to congestion and conflict without rules governing its use. The Coasean approach is to assign private property rights to overcome the tragedy of the spectrum commons. The process of assigning these rights is still centralized, with governments assigning property rights through agencies such as the Federal Communications Commission and National Telecommunications and Information Administration in the USA. We consider the possibility of self-governance of the spectrum. We use insights from the study of common pool resources governance to analyze the emergence of property rights to spectrum in a ‘government-less’ environment in which norms, rules, and enforcement mechanisms are solely the product of the repeated interactions among participants in the network. Our case study considers the spectrum-sharing arrangement in the 1,695–1,710 MHz band. Using agent-based modeling (ABM), we show that self-governance of the spectrum can work and under what conditions it is likely to improve the efficiency of the allocation of property rights.

In many modern nation states, both rich and poor, traditional law to this day plays an important role. Given the almost universal prevalence of traditional law, it is surprising how little we know about it. This is the first study that tries to take stock of traditional law from a cross-country perspective. We are also interested in the compatibility of traditional law with state-enforced law and, in particular, with the basic traits of the rule of law. Based on a sample of up to 134 countries, we find that no ‘typical’ traditional law exists, but that traditional law varies in many dimensions such as its timely enforcement, its impartiality, and its protection of basic human rights. Societies that rely extensively on traditional law score low regarding both the rule of law and per capita income. Historical and geographical factors are important predictors of the contemporaneous reliance on traditional law. State antiquity, for example, reduces the prevalence of traditional law, as does a high share of descendants from European populations.

This introduction to the special issue in honor of Professor Yoram Barzel provides an overview of his scholarship and a summary of the contributions to this special issue. Each contribution advances or elaborates upon major themes in Barzel's theoretical and applied work on property rights, transaction costs, and political economy. The contributions fall into three categories: an examination of the foundations and implications of the ‘Barzelian’ method for social scientific analysis; Barzel's economics of property rights and transaction costs to historical case studies; and advances to Barzel's theory of the state, which includes an analysis of the origins of democracy and the rule of law.

In this paper, we examine reforms characterized by the establishment of mandatory funded privately-managed schemes in the social security framework. We construct a new dataset to analyze the determinants of pension reforms over 1980–2012 in about 100 medium and large economies around the world. Our results highlight the fundamental importance of economic forces in explaining the speed of reforms after adjusting for the confounding effects of demographic and geopolitical factors. Countries with greater globalization growth and a history of economic crisis experienced a shorter time until reform. These findings are robust to variations in empirical methodology.

The paper discusses the many reasons why housing policy can appear to be both incoherent and ineffective - with too many Departments involved each with different objectives and a plethora of policies pulling in different directions. Drawing on earlier research findings the paper discusses three examples which have impacted on tenure mix – the growth in the private rented sector where policy initiatives – except for unintended side effects – have been limited and market and macroeconomic pressures have dominated; a range of tax anomalies which provide inconsistent incentives and generate considerable costs to the economy; and the impact of specific policies which concentrate on supporting owner-occupation through new build initiatives. The paper concludes by asking whether housing policy is inherently unable to withstand the pressures placed on it by both politics and macroeconomic realities.

Qing China represents a counterfactual to the early modern European history of fiscal expansion in the wake of warfare. In response to the staggering costs of suppressing the White Lotus Rebellion (1796–1804), the Jiaqing Emperor sought to solve the empire's fiscal problems by tightening bureaucratic control over an overstretched system of treasury finance. However, Jiaqing's policy of austerity and retrenchment was not simply an expedient in times of fiscal strain, but deeply rooted in ideological struggles over taxation that began in the eighteenth century. It was an expression of hardline fiscal conservatism, which held fixed revenue quotas sacrosanct and which I call quota-ism. This policy had dire consequences for the ability of the Qing regime to respond to external shocks and to fulfill its sovereign tasks – war, river conservancy and famine relief. It contributed to the bankruptcy of Qing government finance by the time of the Opium War.