Abstract The study of institutions and economic history was much influenced by Ronald Coase and Douglass North, in particular with Douglas North’s notion of government as an endogenous outcome of institution competition. Although Max Weber articulated a concept of government as a monopoly of...

When firm-specific human capital is involved, both the worker and the employer have the incentive to prespecify future wages. This incentive arises from transaction costs associated with spot contracts and from opportunistic bargaining which may occur during the postinvestment period. In...