Destructive power, enforcement and institutional change

Vahabi, Mehrdad (2005): Destructive power, enforcement and institutional change. Published in: Journal of Economics and Business , Vol. 9, No. 1 (March 2006): pp. 59-89.

Abstract

Institutions are usually defined as rules of the game. But if rules are dead letters without being enforced, then what is the role of destructive power in the genesis of institutions? This is the first question which will be addressed in the present paper. While the importance of incremental or evolutionary changes in informal rules is undeniable, what is the role of destructive power or revolution in politics with regard to institutional change? To what extent is destructive power involved in the change of rules? This is the second question that will be tackled in the present paper. The purpose of this paper is to answer these two questions focusing on a point that current scholarship regarding institutions usually fail to notice, with an emphasis on rules and laws: the power that enforces those rules and laws. The analysis of different forms of power will demonstrate the fact that the capacity to destroy as well as the capacity to produce plays a role in generating and maintaining institutions. I will try to show that the recognition of destructive power sheds new light on at least three major issues: i) the relationship between property rights and sovereignty, ii) the importance of revolution as well as evolution in social change, iii) the emergence of various means of collective expression such as Luddism, universal suffrage, and association.

• Item Type: MPRA Paper
• Language: English
• Keywords: Destructive power; creative power; exit, voice and scream; institutional change; enforcement
• Subjects: O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O11 - Macroeconomic Analyses of Economic Development; D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D81 - Criteria for Decision-Making under Risk and Uncertainty; K - Law and Economics > K0 - General; F - International Economics > F5 - International Relations, National Security, and International Political Economy; D - Microeconomics > D7 - Analysis of Collective Decision-Making > D74 - Conflict ; Conflict Resolution ; Alliances ; Revolutions; B - History of Economic Thought, Methodology, and Heterodox Approaches > B5 - Current Heterodox Approaches > B52 - Institutional ; Evolutionary; H - Public Economics > H4 - Publicly Provided Goods > H41 - Public Goods; E - Macroeconomics and Monetary Economics > E1 - General Aggregative Models > E11 - Marxian ; Sraffian ; Kaleckian

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