The Frailty of Economic Reforms: Political Logic and Constitutional Lessons

Niclas Berggren ()

No 1, Ratio Working Papers from The Ratio Institute

Abstract: Why are efficiency-enhancing reforms often frail and subject to being undermined over time? Two theories are examined: public-choice theory, which explains this as the possible result of a need, from time to time, to wipe the slate clean in order to retain productivity in the distribution of favors to interest groups, and a theory which acknowledges that politicians may implement reforms for ideological reasons but still, as time passes, be influenced by the logic of the political and media systems to abandon their initial aspirations. In any case, the demise of reforms is partly a function of the constitutional setting: rules which encourage shortsightedness and easy satisfaction of interest-group agendas make it difficult for decision-makers to withstand pressure for legislative change. Avenues to mitigate these problems through constitutional reforms are explored.

Keywords: tax reform; political incentives; constitutional reform (search for similar items in EconPapers)
JEL-codes: D70 E65 H20 H30 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-afr, nep-cdm and nep-mic
Date: 2003-04-01
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