This paper is among the first to theoretically examine the relevance of price competition in the protection market by focusing on the competition between empires. By distinguishing absolute and differential protection rents, we first define coercive rivalry and price competition among empires...

While economic historians have stressed the importance of price competition in the protection market, theorists of conflictual activity have argued against the extrapolation of this form of competition in the protection market and favored competition through the quantity of conflictual effort....

Dueling is one of the best indicators of political transition from anarchy to order. This paper explores the dynamics of dueling for honor as a social institution in England, France, and Germany. It identifies major differences regarding the frequency, duration, and nature of dueling. Although...

This paper explores the relevance of soft budget constraints (SBC) to development studies by examining the parastatal sector. The political ingredient of the SBC is discussed by focusing on two examples: 1) religious and military foundations in Iran; and 2) Fannie Mae and Freddie Mac. It...

Contractual reductionism takes market exchange as the ubiquitous form of economic organization throughout history. Transactions costs are accordingly regarded as the costs of running any economic system in general. This paper explores the nature of protection/aggression costs as specific costs...

The budget constraint as a bookkeeping identity is a fundamental concept of standard microeconomics. Clower reinterpreted this concept as a rational planning postulate. The notion of soft budget constraint (SBC), formulated for the first time by Janos Kornai (1979) in the context of a socialist...

In this paper, we reconsider the concept of the BC in the light of an institutionalist approach. Kornai’s interpretation of the concept provides the basis of such an approach. He defines the BC as a conditional empirical fact regarding the specific behavioural regularity of agents that is...

The concept of ‘mode of coordination’ captures the way economy is embedded in social relationships and influences the integration of society through an ‘instituted process.’ Three main typical or ideal modes of coordination have been identified in the literature, namely the market, the...

The paper first investigates the causes of the recent financial and liquidity crisis in the US and all over the world as a preliminary phase of the imminent recession. It then questions Paulson-Bernanke’s plan as a solution to the crisis and ponders over the differences between EU plan and the...

Institutions are usually defined as rules of the game. But if rules are dead letters without being enforced, then what is the role of destructive power in the genesis of institutions? This is the first question which will be addressed in the present paper. While the importance of incremental or...