Ratio Working Papers
Niclas Berggren and Nils Karlson
Constitutionalism, Division of Power and Transaction Costs
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.
Keywords: Political transaction costs; Constitutionalism; Political institutions; Division of power; Quality of political decision-making; (follow links to similar papers)
JEL-Codes: D70; H11; (follow links to similar papers)
26 pages, September 11, 2002
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- This paper is published as:
Berggren, Niclas and Nils Karlson, (2003), 'Constitutionalism, Division of Power and Transaction Costs', Public Choice, Vol. 117, No. 1-2, pages 99-124
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