Why Institutions Endure: Norms, Leadership, and What Enables Reform

Omer Majeed

CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University

Abstract: Why do most countries remain trapped in bad institutions, while a few transition out? This paper introduces a novel framework highlighting how interactions between societal norms and leadership actions shape institutions. It offers three insights. First, leadership behavior correlates with societal norms through contagion, habit formation, and incentives--cross-country evidence supports this. Second, building on major reforms, the paper shows reforms endure only when norms shift and explains the policy mechanisms behind successful transitions. Third, the paper illustrates how norms anchor strategic reformist-elite interactions.

Keywords: institutions; societal norms; development; leadership; culture; economic growth (search for similar items in EconPapers)
JEL-codes: D02 D72 D73 E02 H83 O43 O57 Z10 Z18 (search for similar items in EconPapers)
Pages: 60 pages
Date: 2025-06, Revised 2026-05
New Economics Papers: this item is included in nep-pke and nep-sea
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https://crawford.anu.edu.au/sites/default/files/20 ... evised_May2026_0.pdf Revised Version (application/pdf)
https://crawford.anu.edu.au/sites/default/files/20 ... sed%20Aug%202025.pdf Revised Version (application/pdf)
https://crawford.anu.edu.au/sites/default/files/20 ... al%20June%202025.pdf Original Version (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:een:camaaa:2025-36

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