TY - JOUR
T1 - The fundamental Coase of development
T2 - Property rights foundations of the effective state
AU - Piano, Ennio E.
AU - Salter, Alexander W.
N1 - Publisher Copyright:
© Millennium Economics Ltd.
Copyright:
Copyright 2020 Elsevier B.V., All rights reserved.
PY - 2020
Y1 - 2020
N2 - This paper identifies political property rights and jurisdictional rivalry as two important mechanisms that drive political and economic development. After developing a general framework to explain relative performance in the 'market for governance", we argue that Western Europe during the High Middle Ages presented initial conditions conducive to the development of effective states. We extend the framework by analyzing city-state governance in Renaissance Italy, as well as public finance practices in early modern Germany. We conclude by discussing the implications of our argument for the literature on state capacity and economic development. The takeaway is that well-aligned political property rights and competition in the provision of governance services can promote the protective and productive state while forestalling the predatory state.
AB - This paper identifies political property rights and jurisdictional rivalry as two important mechanisms that drive political and economic development. After developing a general framework to explain relative performance in the 'market for governance", we argue that Western Europe during the High Middle Ages presented initial conditions conducive to the development of effective states. We extend the framework by analyzing city-state governance in Renaissance Italy, as well as public finance practices in early modern Germany. We conclude by discussing the implications of our argument for the literature on state capacity and economic development. The takeaway is that well-aligned political property rights and competition in the provision of governance services can promote the protective and productive state while forestalling the predatory state.
KW - Political property rights
KW - Western European development
KW - polycentricity
KW - state capacity
UR - http://www.scopus.com/inward/record.url?scp=85090496280&partnerID=8YFLogxK
U2 - 10.1017/S1744137420000260
DO - 10.1017/S1744137420000260
M3 - Article
AN - SCOPUS:85090496280
JO - Journal of Institutional Economics
JF - Journal of Institutional Economics
SN - 1744-1374
ER -