Consolidated democracy, constitutional stability, and the rule of law

Naqvi, Nadeem and Neumärker, Bernhard and Pech, Gerald (2018): Consolidated democracy, constitutional stability, and the rule of law.

Abstract

What sets a consolidated democracy apart? We argue that the expectation that under the rule of law a law-abiding government will not enforce the unlawful acts of its predecessor creates incentives for agents - such as members of the civil service or law enforcement agencies - not to comply with such acts. Thus, even an opportunistic government may find it in its best interest to abide by constitutional rules or, once it has been in violation, to reinstate the legal order. If so, the government contributes to its own punishment and agents’ expectations are self-fulfilling. Thus the rule of law has instrumental value in stabilizing the constitutional order. We also provide a theoretical explanation of the empirical distinction between consolidated and transitory liberal democracies and we explain why consolidated democracies are likely to stave off populist challenges.

• Item Type: MPRA Paper
• Language: English
• Keywords: Constitution, dynamic policy constraints, enforcement mechanism, populism
• Subjects: D - Microeconomics > D2 - Production and Organizations; D - Microeconomics > D7 - Analysis of Collective Decision-Making > D78 - Positive Analysis of Policy Formulation and Implementation; K - Law and Economics > K1 - Basic Areas of Law > K10 - General; K - Law and Economics > K4 - Legal Procedure, the Legal System, and Illegal Behavior > K42 - Illegal Behavior and the Enforcement of Law

References

[1] Abreu, Dilip, 1988, On the Theory of Infinitely Repeated Games with Discounting, Econometrica 56, 383-396.

[2] Acemoglu, Daron, 2003, Why Not a Political Coase Theorem? Social Conflict, Commitment and Politics, Journal of Comparative Economics 31, 620–652.

[3] Acemoglu, Daron, Georgy Egorov, Konstantin Sonin. 2012, Dynamics and Stability of Constitutions, Coalitions, and Clubs, The American Economic Review 102, 1446-1476.

[4] Acemoglu, Daron, Egorov, G., Sonin, K., 2013, A Political Theory of Populism, The Quarterly Journal of Economics, 771-805.

[5] Acemoglu, Daron and James Robinson, 2006. The Economic Origins of Dictatorship and Democracy, Cambridge University Press.

[6] Acemoglu, Daron, Davide Ticchi and Andrea Vindigni, 2011. Emergence and Persistence of Inefficient States, Journal of the European Economic Association 9, 177-208.

[7] Aghion, Phillipe, Alberto Alesina, and Francesco Trebi, 2004. Endogenous Political Institutions. The Quarterly Journal of Economics 119, 565-611.

[8] Basu, Kaushik, 1989. Technological Stagnation, Tenurial Laws, and Adverse Selection. The American Economic Review 79, 251-255.

[9] Binswanger, Johannes, Pru¨fer, Jens, 2012. Democracy, Populism, and (Un)bounded Rationality, European Journal of Political Economy 28: 358372.

[10] Clague, Christopher, Philip Keefer, Stephen Knack and Mancur Olson, 1996. Property and Contract Rights in Autocracies and Democracies. Journal of Economic Growth 1: 243-276.

[11] Fearon, James, 2011. Self-Enforcing Democracy, The Quarterly Journal of Economics 126, 1661–1708.

[12] Frankel, David M., Stephen Morris and Ady Pauzner, 2003. Equilibrium Selection in Global Games with Strategic Complementaries. Journal of Economic Theory 108, 1-44.

[13] Gans-Morse, Jordan, 2017. Demand for Law and the Security of Property Rights. American Political Science Review 111, 2017, 338-359.

[14] Gersbach, Hans, 2004. Competition of Politicians for Incentives Contracts and Elections, Public Choice 121, 157-177.

[15] Hayek, Friedrich A., 1960. The Constitution of Liberty, University of Chicago Press.

[16] Huq, Aziz and Tom Ginsburg, forthcoming. How to Lose a Constitutional Democracy, UCLA Law Review.

[17] Levitsky, Steven and Daniel Ziblatt, 2018. How Democracies Die, Random House.

[18] MacElligot, Anthony, 1999. Dangerous Communities and Conservative Authority: The Judiciary, Nazis, and Rough People, 1932-1933, in: MacElligot, Anthony, Kirk, Tim, Opposing Fascism. Community, Authority, and Resistance in Europe, Cambridge University Press: 33-47.

[19] Maddox, Graham, 1982. A Note on the Meaning of ’Constitution’. American Political Science Review 76, 805-809.

[20] Michalak, Katja, Pech, Gerald, 2013. Stable Constitutions in Political Transition, in: Advances in Political Economy: Institutions, Modeling and Empirical Analysis, ed. by Caballero, G., Kselman, D. and Schofield, N., Springer Press 2013: 67-89.

[21] Morris, Stephen and Hyun Song Shin , 2000. Global Games: Theory and Applications, in: Mathias Dewatripont, Lars Peter Hansen and Stephen Turnovsky (Eds.), Advances in Economics and Econometrics, the Eighth World Congress. Cambridge University Press.

[22] Mu¨ller, Jan-Werner, 2016. What Is Populism? University of Pennsylvania Press, Philadelphia.

[23] Naqvi, Nadeem, 1990. Technological Stagnation, Tenurial Laws, and Adverse Selection: Comment. The American Economic Review 80, 935-940.

[24] Pech, Gerald, 2009. Rationality and the Legal Order, in: Tom Boylan and Ruvin Gekker (Eds.), Rational Choice and Normative Philosophy. Routledge.

[25] Phillips, O.Hood and Jackson, Paul, 1987. O.Hood Phillips’ Constitutional and Administrative Law, 7th ed., London: Sweet and Maxwell.

[26] Roland, G. and Thierry Verdier, 2003. Law Enforcement and Transition. European Economic Review 47, 669-685.

[27] Slovik, Milan, 2008. Authoritarian Reversals and Democratic Consolidation, American Political Science Review 102: 153-168.

[28] Voigt, Stefan, 1997. Positive Constitutional Economics: A Survey. Public Choice 90, 11-53.

[29] Weingast, Barry R., 1997. The Political Foundations of Democracy and the Rule of Law. American Political Science Review 91, 245-263.

[30] Weingast, Barry R., 2005. The Constitutional Dilemma of Economic Liberty. Journal of Economic Perspectives 19, 89-108.