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Constitutionalism, Division of Power and Transaction Costs

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Abstract
According to many democracy theorists, there is an unavoidable trade-off between constitutionalism and the need for political action. This paper criticizes that belief. Rather, it argues that a division of power, while sometimes entailing high political transaction costs, can nevertheless be beneficial and that it is not necessarily the case that a division of power does entail high transaction costs. The analysis expands the framework of Buchanan and Tullock (1962). Constitutionalism is thus defended against one of its main perceived deficiencies: its bringing about gridlock. This does not always happen, and when it does, it is often a good thing.

Suggested Citation

  • Berggren, Niclas & Karlson, Nils, 2002. "Constitutionalism, Division of Power and Transaction Costs," Ratio Working Papers 3, The Ratio Institute.
    • Handle: RePEc:hhs:ratioi:0003
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    File URL: http://www.ratio.se/pdf/wp/nb_nk_constitutionalism.pdf
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    References listed on IDEAS

    as
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    Cited by:

    1. Markus Leibrecht & Hans Pitlik, 2014. "Generalised Trust, Institutional and Political Constraints on the Executive and Deregulation of Markets," WIFO Working Papers 481, WIFO.
    2. Niclas Berggren & Christian Bjørnskov, 2022. "Political institutions and academic freedom: evidence from across the world," Public Choice, Springer, vol. 190(1), pages 205-228, January.
    3. Mogens Justesen & Peter Kurrild-Klitgaard, 2013. "Institutional interactions and economic growth: the joint effects of property rights, veto players and democratic capital," Public Choice, Springer, vol. 157(3), pages 449-474, December.
    4. Wohlgemuth, Michael, 2004. "The Communicative Character of Capitalistic Competition: A Hayekian response to the Habermasian challenge," Freiburg Discussion Papers on Constitutional Economics 04/1, Walter Eucken Institut e.V..
    5. Vahabi,Mehrdad, 2019. "The Political Economy of Predation," Cambridge Books, Cambridge University Press, number 9781107591370.
    6. Mehrdad Vahabi, 2011. "Appropriation, violent enforcement, and transaction costs: a critical survey," Public Choice, Springer, vol. 147(1), pages 227-253, April.
    7. Niclas Berggren, 2012. "The Calculus of Consent: some Swedish connections," Public Choice, Springer, vol. 152(3), pages 313-321, September.

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    More about this item

    Keywords

    Political transaction costs; Constitutionalism; Political institutions; Division of power; Quality of political decision-making;
    All these keywords.

    JEL classification:

    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government

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