Political Learning: The Neglected Precondition of Constitutional Reform

This paper analyses the claim of constitutional economics that liberal economic policy requires far-reaching constitutional reform. The paper starts with a restatement of this claim and reinforces the rationale of the currently most influential variants of constitutional economics as represented by contractarian constitutional economics (Brennan, Buchanan), on the one hand, and Hayek s evolutionary theory, on the other. However, these constitutional proposals have shortcomings because the institutional preconditions of constitutional reform are not sufficiently reflected. Instead, I argue that, in face of economic crisis, a revision of in-period politics requires no more collective rationality than constitutional reform does. As a consequence, the introduction of new constitutional rules depends on political learning. The article concludes that constitutional rules in the sense of CPE can stabilise political learning but they cannot replace it.     

The problem of constitutional legitimation: what the debate on electoral quotas tells us about the legitimacy of decision-making rules in constitutional choice

Proponents of electoral quotas have a ‘dependent interpretation’ of democracy, i.e. they have formed an opinion on which decision-making rules are fair on the basis of their prior approval of the outcomes these rules are likely to generate. The article argues that this position causes an irresolvable problem for constitutional processes that seek to legitimately enact institutional change. While constitutional revision governed by formal equality allows the introduction of electoral quotas, this avenue is normatively untenable for proponents of affirmative action if they are consistent with their claim that formal equality reproduces biases and power asymmetries at all levels of decision-making. Their critique raises a fundamental challenge to the constitutional revision rule itself as equally unfair. Without consensus on the decision-making process by which new post-constitutional rules can be legitimately enacted, procedural fairness becomes an issue impossible to resolve at the stage of constitutional choice. This problem of legitimation affects all instances of constitutional choice in which there are opposing views not only about the desired outcome of the process but also about the decision-making rules that govern constitutional choice.     

The migration policy of developed Socialist society: problems of improvement

In the USSR the need for migration policy stems from objective processes in the development of socialist production and from its constant structural and territorial modifications, which are particularly palpable under current conditions, at a time when vast new regions are undergoing intensive development. Migration policy, to play the part of an effective instrument for exerting a purposeful influence on migration processes, must be stable in its basic directions and relatively flexible when it is necessary to react quickly to changes in various relatively local circumstances. The determination of criteria of optimization of migration processes is of paramount significance for the solution of problems of migration policy. The improvement of migration policy under the conditions of developed socialism must be based on the known patterns of reproduction of the population. At the same time it is necessary to consider the fact that the migration of the population proper can be considered as the source of regional differences in this reproduction and simultaneously is their consequence to a considerable degree. Consequently, 1 of the approaches to the elaboration of migration policy measures is oriented toward the equalization of conditions of population reproduction at the settlement and regional level. Many investigators of the problem of retaining youth in the countryside and of attracting skilled persons to rural areas believe the optimization of the productive and nonproductive spheres of activity to be the solution. Migration policy is implemented at 3 levels: the population as a whole; the collective; and the individual. Migration policy measures are divided according to the nature of their impact on the population into economic, moral, and administrative categories with the leading role assigned to economic measures. Among the economic measures that stimulate migration, a leading role is played by cash payments in the form of wage increases and one time grants. Recognizing the role of distribution on the basis of labor in the regulation of the migratory mobility of the population, the general direction of improvement of migration policy consists in the further raising of the role of consumption funds and particularly the fund for the joint satisfaction of requirements. The superiority of social consumption funds over wages in attracting and retaining the population stems particularly from the fact that the consumption of goods and services available free of charge or for a reduced charge occurs only at the place where they are offered. Ecomonic measures of migration policy must consider the fact that work incentives have recently included creative stimuli associated with the character, content, and conditions of work.     

Presidentialism, Parliamentarism, and the Provision of Collective Goods in Less-Developed Countries

Parliamentary systems are more likely, ceteris paribus, than presidential systems to give politicians the incentive to provide policies aimed at broad national constituencies rather than at particularistic sectoral or regional constituencies, because a parlimentary constitutional design encourages legislators to subordinate their pursuits to their parties' broader interests. However, less-developed countries often lack the conditions for the nationally oriented parties that parliamentarism requires in order to thrive, due to such factors as sharp disparities in development across regions and income groups. Thus the provision of collective goods in such countries may be facilitated by the establishment of presidential executives, which can be delegated independent constitutional authority to structure the national policy process. Policy-making in these cases thus can be stylized as a presidency elected nationally and granted strong powers over legislation that partially counteract the particularistic tendencies of a fragmented legislature whose members remain close to their regional constituencies.     

Innovation,externalities, and the state: a synergetic approach

A politicoeconomic model dealing with the interaction of private innovation and public regulation is presented. Causes and effects of this interdependence are investigated with special regard to the externalities which accompany innovations and make them into a partly public good. Our main hypothesis is that the collective character of inventive activity gives rise to synergetic effects. This hypothesis is supported by a microfoundation based on a nonlinear Markov process. Furthermore, the consequences of such synergetic innovation processes are examined: persistent disequilibrium, multiple equilibria, lock-in, path dependence, and chaos. Finally, some policy implications are derived concerning the effects of ageneral public promotion of innovations and of aselective industrial policy.     

Designing tax policy in federalist economies: An overview

The emerging economic federations of the European Union, Russia, and South Africa, along with the established federations in Australia, Canada, and the United States, confront the task of designing the institutions for federal fiscal policy. This paper reviews the literature on the design of tax policy in federalist economies. We conclude that taxation by lower level governments can lead to significant economic inefficiencies and inequities. The usual ‘assignment’ view of federalis recommends central government policies — for example, resident-based taxation or grants-in-aid — to correct these failures. These recommendations assume that the central government will act as a benevolent social planner. The ‘political economy’ view of federalism suggests that this assumption is in error and that additional federalist institutions must be considered. Alternative legislative structures and constitutional rules are considered.     

Constitutional protection of economic rights: The Swiss and U.S. experience in comparison

This paper analyzes the contribution of the Swiss and the U.S. Constitution to protect economic liberties, and compares the different strategies that both constitutions rely on to achieve this goal. Pertinent provisions in the Swiss Constitution are rather precise but relatively easy to change, whereas the U.S. Constitution is characterized by vaguely formulated constraints that are difficult to amend formally and that are interpreted by the Supreme Court. Nevertheless, the substantial constitutional changes that did occur in both countries seem to have followed strikingly similar patterns: Initially, regional integration through reciprocal market opening within both countries facilitated the constitutional protection of economic liberties. Subsequently, the constitutional protection of economic liberties eroded in both countries, especially against federal legislation, due to changes in the interpretation of the constitution through the courts, or by formal amendment. Lastly, both constitutions were not immune against sudden demands by special interest groups that were being raised during times of crisis or war. I wish to thank Beat Blankart, Ludger Schuknecht and Barry Weingast for helpful comments.     

From Schumpeterian Democracy to Constitutional Democracy

A critical issue of a constitutional democracy is to determine an optimal limitation of citizens' political liberties. This problem is analysed here within the framework of a parliamentary system of government, and in the context of Rawls' principle of equal political participation. It is argued that optimal barriers to entry into political competition are a function of the legislative decision rules, the domain of collective choices, and the rules for selecting (and dismissing) the executive. Contrary to Schumpeter and Riker who rejected populism (the approach that public policy should be a result of citizens' preferences), we argue that it is possible to reconcile greater citizen participation and liberal democracy with an appropriate institutional design.     

TRADE POLICY AND INDIRECT RENT SEEKING: A SYNTHESIS OF RECENT WORK†

This paper synthesizes a body of work in trade theory and commercial policy. A common theme unifies this literature: The prospect of protection, institutionalized in the policy formation process and the rules for administered protection, can induce real changes in economic activity independent of whether actual barriers to trade have been imposed. These changes are designed to indirectly manage policy outcomes by either encouraging or defusing protectionist pressures. Thus firm conduct may be distorted by incentives to optimize on a politically-determined margin and the evolution of protectionist events may be shaped by more than the direct lobbying efforts of interest groups.     

Money,Credit, and Business Fluctuations*

This paper provides a critique of standard theories of money, in particular those based on money as a medium of exchange. Money is important because of the relationship between money and credit The process of judging credit worthiness, in which banks play a central role, invokes the collection and processing of information. Like many other economic activities involving information, these processes are not well described by means of standard production functions. Changes in economic circumstances can have marked effects on the relevance of previously accumulated information and accordingly on the supply of credit Changes in the availability of credit may have marked effects on the level of economic activity, while changes in real interest rates seem to play a relatively minor role in economic fluctuations. This alternative view has a number of implications for policy, both at the macroeconomic level (for instance, on the role of monetary policy for stabilization purposes and the choice of targets) and at the microeconomic level.     

科学技术有效流动与区域间非行政壁垒

协同创新要求突破创新主客体间壁垒,促进科学技术的有效流动以充分释放创新要素活力。构建了区域间科学技术流动潜力的引力模型,通过地区间地理距离、经济距离和技术距离矩阵,计算不同区域技术吸收水平,并利用改进的Romer模型计算了科学技术流动的地理壁垒、经济壁垒和技术壁垒。结果表明：①就全国整体而言,地理壁垒的约束作用最强,但在2009年以后弱化。技术壁垒的约束作用最小,在2014年以后有不断扩大的趋势。经济差距壁垒的变化趋势与总壁垒相同,是后期影响科学技术有效流动的最主要因素。中国科学技术流动的总壁垒呈现出在波动中减小的趋势,并先后由地理壁垒、经济壁垒和技术壁垒主导;②从空间上看,阻碍科学技术流动的非行政壁垒的空间分布差异显著,东北及西部沿边地区地理壁垒较为突出,东北、西北和中部地区的经济壁垒更为明显,而技术壁垒则主要集中在华北和西南地区。最后,根据研究结论提出相关政策建议,以促进区域间科学技术高效合理流动。     

Transferring Measures of Adult Health Benefits to Children: A Review of Issues and Results

This article discusses issues involved in inferring the economic value of children's health from estimates of the value of adult health. A central theme is that if health benefit transfers across individuals are to be useful to policy makers, they must be founded on analytical as well as statistical commonalities. Whether the health benefits transfer issue is among adults or between adults and children, a vision that embeds the individual in a collective entity, such as a family with limited time and resources, can provide a common analytical structure having substantive economic content and able to accommodate varying measures of health. (JEL I , D1 , Q2 )     

新农村建设中红色文化遗产法律保护的经济学分析

文章基于公共物品私人供给的模型,构建了新农村建设时期乡村红色文化遗产保护过程中村民在个体理性支配下同集体理性进行博弈的分析框架,并据此对实践中存在的保护政策失效和村民间保护意愿差异的现象进行了解析。结论认为,村民在个体理性支配下的博弈行为符合福利经济学基本理论,构成了保护政策失效的主要原因;为此,结合村民的行为特点和福利经济学的分析,引入了法律保护机制以探求思路和对策。     

Decentralized Governance,Constitution Formation,and Redistribution

What determines the relative strength of central and regional governments? Why do centers engage in more or less geographically based economic redistribution? And why do some centers redistribute from urban to rural areas while others do the opposite? This research answers these questions with reference to decentralized politics at key constitutional moments. Much contemporary research underscores the importance of the intergovernmental balance of power – be it in taxing authority or decision making autonomy – on economic outcomes. Many features of that balance are rooted in bargains struck at the time of constitution writing. Here, I suggest that the key ingredients in such bargains are the number of conflicting geographically salient factor endowments, the distribution of inter-regional inequality, and the degree of intra-state inequality within rural and urban regions. The greater the level of factoral conflict, the more elites who engage in constitutional negotiations are likely to constrain the central government by providing for substantial regional veto authority. Higher levels of inter-regional inequality heighten demands for inter-regional redistribution. Given some level of regional demand for central redistribution, whether its net effect is in favor of urban or rural regions will depend on the coalitional implications of inequality within regions. I examine the argument in light of the U.S., Argentine, and Indian processes of constitution formation.     

New constitutional “debt brakes” for Euroland? A question of institutional complementarity

Despite the EU Stability & Growth Pact and existing constitutional limits on public deficit/debt at the (sub)national level in many EU member countries, in the wake of the 2010 Greek bailout, many politicians and policy advisors have proposed new constitutional “debt brakes” to prevent future fiscal crises and bailouts. This paper puts a question mark behind this popular policy recommendation. Public choice scholars and other critical observers have repeatedly emphasised that constitutional deficit/debt limits are not per se credible commitments to run a sound fiscal policy in the future. To demonstrate this, design defects of such fiscal constraints are usually pointed out (no politically independent control, no sanctions, etc.). Going beyond this standard approach of credibility assessment, this paper argues for taking the issue of institutional complementarity seriously. To assess its credibility, one has to not only examine the design of a deficit/debt limit but also the institutional environment (tax/expenditure policy, capital market, etc.) in which such a constitutional commitment is embedded.     

Participatory decision-making in land use planning: An application in Costa Rica

The economic, social and environmental implications of electricity generation for land use planning are a significant and complex problem in many countries. One reason for this complexity is the existence of several stakeholders with very different views or perceptions of the different criteria underlying the decision-making process. Therefore, the aggregation of individual stakeholder preferences into a single collective preference is a crucial problem. In this paper, this type of problem is addressed with the help of a methodology based upon the definition of a consensus within a distance-based framework. The methodology is applied to a case study in Costa Rica at two levels: at a national level and at a river basin level. The River Birrís was chosen because the conflict of interests between agricultural production and electricity generation are especially significant in this basin.     

Why Meso? On “Aggregation” and “Emergence”, and Why and How the Meso Level is Essential in Social Economics

Simplistic aggregation in idealized “markets” versus structural emergence in complex and path-dependent processes have always marked a “continental divide” between neoclassical mainstream economics and all kinds of evolutionary and institutional social economics. This paper deals with institutional, or structural, emergence and argues that the meso level (to be specific) is the proper aggregate level for social economic analyses of complex systems and processes. Also, neo-Schumpeterian economists have stressed recently the issue of an “institutional trajectory” taking place on the meso economic level. This paper argues that the creative ideas of a Schumpeterian entrepreneur are not a sufficient explanation in this case. Using an evolutionary interpretation of a simple game-theoretic formalism (the Folk Theorem), the paper strives to demonstrate that the meso level, as the proper level of institutional emergence, must and can be endogenously explained from a process of interactive problem-solving of interdependent agents, in their struggle for coordination under strong uncertainty. It will be illustrated that a meso-sized socio-economic group co-evolves, and is constituted, together with the institution that in turn serves as the solution to the coordination problem. The practical and policy implications of the argument are discussed.

CANDIDATE VALENCE: EVIDENCE FROM CONSECUTIVE PRESIDENTIAL ELECTIONS*

This article develops and estimates a dynamic spatial model of voting. The distribution of voters' policy positions and candidates' valence are recovered using individual‐level data on voting decisions in two consecutive presidential elections. The estimated model is used to provide an equilibrium interpretation of observed individual voting profiles and aggregate electoral outcomes as well as to conduct counterfactual experiments that assess the impact of candidates' policy positions, valence, and voters' information on electoral outcomes.     

A Fragmented China: Measure and Determinants of Chinese Domestic Market Disintegration

This paper studies the degree of integration of China's domestic market and investigates the determinants of inter‐provincial trade barriers under the rubric endogenous trade policy theory. I rely on industry‐level trade flows extracted from provincial input–output tables to develop a model that analyzes the magnitude and evolution of Chinese provinces’ engagement in domestic trade by computing all‐inclusive indicators of trade barriers. Results underline that over the 1990s, not only was China's domestic market fragmentation along provincial borders great, but it also has become more severe at least between 1992 and 1997. The investigation of province‐level and industry‐level trade barriers confirms the relevance of applying the framework of endogenous protection to explain the level of impediments to trade between Chinese provinces. Findings emphasize that provinces’ domestic trade protection pursues a dual objective of socio‐economic stability preservation and fiscal revenues maximization.