Countries’ Constitutions Viewed from an Economic Perspective: Why They Are Enacted and How Stable They Are
More details
Hide details
Publication date: 2015-06-30
GNPJE 2015;277(3):79–105
Based on recent literature on the subject, the article investigates why countries need constitutions and how constitutions influence economies. The authors look at how lasting national constitutions are and why they are amended. The analysis is based on approaches including Constitutional Economics, New Political Economy, and Law and Economics. The authors reach for explanations related to property rights economics, interest group theory, and analysis of the distribution of political power between various groups of society. The study identifies the primary factors shaping the process of establishing constitutional rules and their stability. It also highlights four channels through which constitutions influence economies. In particular, the authors focus on: (1) the constitution’s role in enhancing the credible commitments of political elites, (2) its significance for political stability within the state, (3) the functioning of interest groups benefiting from various constitutional provisions, and (4) transaction costs that various actors bear because of the necessity to adjust to the enforced rules or attempts to evade them. The authors formulate conclusions that they say could contribute to further research on the potential substitutability and complementarity of constitutional rules and to studies focusing on the issue of endogenizing constitutions.