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Informal Institutions in Comparative Politics
Abstract
Research in comparative politics on informal institutions can be grouped into analysis of norms and values within government institutions and studies of self-governance in communities that are relatively isolated from states. Three recent books by Nadya Hajj, Shelby Grossman, and David Skarbek advance this research agenda by showing that self-governance can be significant even in contexts where the state is present, including refugee camps, markets in urban settings, and in prisons. They also offer abundant insights into how to overcome challenges with measuring and analyzing informal institutions. Rather than prioritize private or public governance, the authors see these as imperfect alternatives that invite analysis of why private governance works better in some contexts than in others for communities seeking to improve their lives in challenging circumstances.
... Other disciplines -like comparative or international politics -may not see things the same way. Murtazashvili and Murtazashvili (2024) provide a fruitful review article showing how insights from the economics of anarchy may be of interest to these two disciplines. In contrast with internationalists who see anarchism as the jumping off point for the Hobbesian jungle, or comparativists who may see anarchic institutions as playing second fiddle to powerful states (Murtazashvili & Murtazashvili, 2024, p. 3), the economic study of anarchy adds a richness to our understanding of historical state building and the importance of informal institutions. ...
Legacy of statehood is seen as a positive influence on economic growth and development. The state antiquity literature argues that the more experience a country has with state institutions, the more beneficial the current state’s impact on development can be. While not discounting the advantages that a well-functioning state can provide for economic progress, we draw attention to an alternate mechanism: the presence of private institutions and practices that may contribute to both state formation and economic development. Rather than state antiquity being the lone cause of economic progress, states may benefit from already existing configurations of rules and conventions that were developed privately. Thus, we argue that order can precede and coincide with the state. We support our claim with qualitative evidence using historical case studies.
Why has Japan failed to fulfill the mission of its 2005 postal privatization legislation? The answer is informal institutions that empower the postmasters within the electoral system and facilitate the mobilization of elites on behalf of anti-reformist goals. To support this claim, I analyze three such institutions: the postmasters’ ownership of postal facilities; the re-employment of former bureaucrats by the postal system and of top postal employees elsewhere in the system; and sales and vote-mobilization quotas. Theoretically, this study analyzes four sources of informal institutional resilience following formal institutional change: the heretofore understudied participation of officialdom in the introduction, communication, and enforcement of informal institutions; the establishment of such institutions prior to new formal rules; institutional duplication across economic sectors; and institutional complementarities.
The efficiency of “quasimarkets” — decentralized public goods provision subjected to Tiebout competition — is a staple of public choice conventional wisdom. Yet in the 1990s a countermovement in political economy called “neoconsolidationism” began to challenge this wisdom. The neoconsolidationists use the logic of government failure central to public choice economics to argue that quasimarkets fail and that jurisdictional consolidation is a superior way to supply public goods and services in metropolitan areas. Public choice scholars have largely ignored the neoconsolidationists’ challenge. This paper brings that challenge to public choice scholars’ attention with the hope of encouraging responses. It also offers some preliminary thoughts about the directions such responses might take.
A good reputation can be an effective bond for honest behavior in a community of traders if members of the community know how others have behaved in the past - even if any particular pair of traders meets only infrequently. In a large community, it would be impossibly costly for traders to be perfectly informed about each other's behavior, but there exist institutions that can restore the effectiveness of a reputation system using much less extensive information. The system of judges used to enforce commercial law before the rise of the state was such an institution, and it successfully encouraged merchants (1) to behave honestly, (2) to impose sanctions on violators, (3) to become adequately informed about how others had behaved, (4) to provide evidence against violators of the code, and (5) to pay any judgments assessed against them, even though each of these behaviors might be personally costly. Copyright 1990 Blackwell Publishers Ltd..
Trade prospered in absence of law in California during the 1830s and 1840s. Merchants, through intermerchant trade and the
partnerships they organized to buy goods abroad, played a central role in trade. This article examines the private-order institution
that facilitated intermerchant trade. The hypothesis is that a particular type of private-order institution, a coalition,
governed agency relations among merchants in California. Within the coalition, a reputation mechanism mitigated the commitment
problem inherent in having individuals handle goods that they did not own by linking a merchant's past behavior and his future
payoff. Evidence from the merchants' business correspondence supports the hypothesis. A game-theoretic model of a coalition
is presented. The model provides insight into the punishment merchants imposed on cheaters, the expansion of the coalition
in the 1830s, and its collapse around the time of the gold rush in 1848–1849
Collective vigilantism, group violence to punish perceived offenses to a community, is both global and common in the contemporary world. It is also crucial for understanding state formation, contestation, crime, law and justice, inequality, and racial and ethnic conflicts. We review existing definitions and explanations for collective vigilantism, present a new typology of collective vigilantism that considers both the aims and level of organization of participating agents, and highlight important patterns that emerge from recent research, including the contributions to this special symposium. We present an argument for what a political science treatment of the topic can offer and introduce an ambitious research agenda that builds on cross-cutting themes and puzzles that emerge from the special symposium.
How can economists use qualitative evidence – such as archival materials, interviews, and ethnography – to study institutions? While applied economists typically rely on quantitative evidence and statistical estimation, many important aspects of institutions and institutional change appear in the form of qualitative evidence. This raises the question if, and how, social scientists trained in quantitative methods can exploit and analyze this evidence. This paper discusses two qualitative research methods that are both commonly used outside of economics: comparative case studies and process tracing. Drawing on existing research about crime and political revolutions, it discusses these two methods and how to implement them to improve institutional analysis.
Scholars and policymakers prescribe legal titling to improve prospects for economic development and political order. However, a public choice literature exists that has long recognized that self-governance often works well and that the state may not be able to improve upon local economic institutions at reasonable cost. Although the implication that legal titling should proceed with caution is seemingly straightforward, the literature on legal titling does not take anarchy seriously as a policy option. In addition, there is a public choice literature that presumes the state is the most important source of property rights. This essay fills this gap in the property rights literature by applying the concept of “efficient anarchy” to legal titling in Afghanistan. Original fieldwork evidence from rural Afghanistan suggests that anarchy of land governance is a better option than legal titling. The essay concludes by opening up the black box of state building by explaining why it often makes sense to sequence improvements in political capacity and political constraints prior to investing in legal titling.
How do formalized property rights develop in transitional settings where there is an absence of formal state structures? This paper hypothesizes that, in the presence of capital for investment, a non-state hegemon with long time horizons can intervene to formalize property rights. The
hypothesis is tested using 191 surveys and interviews collected in Nahr al Bared (NBC) and Beddawi refugee camps in Lebanon. Results suggest that following an influx of remittances, Fatah formalized property rights through the creation of local camp committee offices that served as a third-party
enforcement mechanism. Also, the results uncover an alternative political motivation for property right formalization. In transitional settings, formalized property rights serve critical state-building functions by uniting and galvanizing a community around a new political party.
Allusions to the “problem of metropolitan government” are often made in characterizing the difficulties supposed to arise because a metropolitan region is a legal non-entity. From this point of view, the people of a metropolitan region have no general instrumentality of government available to deal directly with the range of problems which they share in common. Rather there is a multiplicity of federal and state governmental agencies, counties, cities, and special districts that govern within a metropolitan region.
This view assumes that the multiplicity of political units in a metropolitan area is essentially a pathological phenomenon. The diagnosis asserts that there are too many governments and not enough government. The symptoms are described as “duplication of functions” and “overlapping jurisdictions.” Autonomous units of government, acting in their own behalf, are considered incapable of resolving the diverse problems of the wider metropolitan community. The political topography of the metropolis is called a “crazy-quilt pattern” and its organization is said to be an “organized chaos.” The prescription is reorganization into larger units—to provide “a general metropolitan framework” for gathering up the various functions of government. A political system with a single dominant center for making decisions is viewed as the ideal model for the organization of metropolitan government. “Gargantua” is one name for it.
Positive and negative selective incentives are shown analytically to have different structural implications when used to induce collective action. Positive selective incentives are effective for motivating small numbers of cooperators and generate pressures toward smaller, more "elite" actions, unless the incentives have jointness of supply. Nega tive selective incentives are effective for motivating unanimous co operation, but their use is often uneven and cyclical and may gener ate hostilities which disrupt the cooperation they enforce. Examples of these dynamics are found in many arenas of collective action and social movements. One important feature of collective action is the use of selective incen tives to reward those who cooperate in the action or punish those who do not. An arts fund may reward contributors by giving a lavish party or by printing their names in a program. Workers ensure cooperation with a strike by threatening to ostracize or beat up strikebreakers. In the 1960s, famous folksingers rewarded antiwar demonstrators by singing at protest rallies. In the 1970s, Louisville antibusing protesters threatened violence against other whites to induce them to keep their children out of school. This paper considers relations among potential cooperators, not their re lations with any "enemy." It discusses the processes that arise when actors reward and punish each other to motivate or sustain cooperation in some form of collective action. The first half of the paper provides a formal analysis which reviews the work of Mancur Olson and his critics, formal izes the decision to participate in collective action, and then formalizes and examines the decision to use a resource as a selective incentive to in duce others to act collectively. The second half of the paper draws out the implications of this analysis. The most important implication is the difference between rewards and punishments when they are used as selective incentives. This implication 1 I would like to thank James Wiggins, Elizabeth Martin, Patricia Rieker, Jean War ren, Ross Purdy, William Gamson, and Anthony Oberschall for helpful comments on earlier versions of this paper, and especially to acknowledge the extensive, detailed, and illuminating critical commentary of John Lemke, Bertrand Shelton, and three anony mous reviewers as this paper moved toward its final form.
Mainstream comparative research on political institutions focuses
primarily on formal rules. Yet in many contexts, informal institutions,
ranging from bureaucratic and legislative norms to clientelism and
patrimonialism, shape even more strongly political behavior and
outcomes. Scholars who fail to consider these informal rules of the
game risk missing many of the most important incentives and constraints
that underlie political behavior. In this article we develop a
framework for studying informal institutions and integrating them into
comparative institutional analysis. The framework is based on a
typology of four patterns of formal-informal institutional interaction:
complementary, accommodating, competing, and substitutive. We then
explore two issues largely ignored in the literature on this subject:
the reasons and mechanisms behind the emergence of informal
institutions, and the nature of their stability and change. Finally, we
consider challenges in research on informal institutions, including
issues of identification, measurement, and comparison. a
This paper analyzes trial by poison ingestion, or “sassywood,” as an institution of criminal justice in contemporary Liberia. We argue that effective criminal justice institutions must satisfy three conditions: they must be accessible to citizens, incentivize judicial administrators to pursue justice instead of private ends, and generate useful information about accused criminals’ guilt or innocence. Liberia’s formal criminal justice institutions fail to satisfy these conditions. Sassywood does a better job of fulfilling them. Sassywood is more accessible than Liberia’s formal criminal justice institutions. It provides judicial administrators stronger incentives to pursue justice. And, unexpectedly, it’s capable of generating useful information about criminal defendants’ guilt or innocence where Liberia’s formal criminal justice institutions do not. Sassywood is a sensible institutional substitute for formal Liberian criminal justice.
The article is webbed at:
http://www.daviddfriedman.com/Academic/Law_as_a_private_good/Law_as_a_private_good.html
Under anarchy, uncoordinated competitive theft by “roving bandits” destroys the incentive to invest and produce, leaving little for either the population or the bandits. Both can be better off if a bandit sets himself up as a dictator—a “stationary bandit” who monopolizes and rationalizes theft in the form of taxes. A secure autocrat has an encompassing interest in his domain that leads him to provide a peaceful order and other public goods that increase productivity. Whenever an autocrat expects a brief tenure, it pays him to confiscate those assets whose tax yield over his tenure is less than their total value. This incentive plus the inherent uncertainty of succession in dictatorships imply that autocracies will rarely have good economic performance for more than a generation. The conditions necessary for a lasting democracy are the same necessary for the security of property and contract rights that generates economic growth.
This paper experimentally examines image motivation - the desire to be liked and wellregarded by others - as a driver in prosocial behavior (doing good), and asks whether extrinsic monetary incentives (doing well) have a detrimental effect on prosocial behavior due to crowding out of image motivation. By definition, image depends on one’s behavior being visible to other people. Using this unique property we show that image is indeed an important part of the motivation to behave prosocially. Moreover, we show that extrinsic incentives interact with image motivation and are therefore less effective in public than in private. Together, these results imply that image motivation is crowded out by monetary incentives; which in turn means that monetary incentives are more likely to be counterproductive for public prosocial activities than for private ones.