European economic and monetary integration provides further incentives to increase public deficits and debt in Europe. Spillover effects and free-riding strategies are likely to come into being in an EMU. As a response to this challenge, the authors propose the introduction of constitutional...

We examine both benefits (production-enhancing cooperation) and costs (taxes and rent-seeking) of institutions of conflict management, like corporatism and trust, in the context of a simple growth model. Contrary to previous research, we predict a non-linear relationship between institutions and...