Rules and Reason : Perspectives on Constitutional Political Economy

Author: Ram Mudambi, Pietro Navarra, Giuseppe Sobbrio
List Price: $28.00
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ISBN: 0521659590
Publisher: Cambridge University Press (29 January, 2001)
Sales Rank: 886,616
Average Customer Rating: 5 out of 5

Customer Reviews

Rating: 5 out of 5
Sensible Structures and Structural Sense
Never in human history have the nations of the world been closer to each other in terms of access and the transmission of ideas and culture. In spite of this, they are characterized by huge disparities in terms of the level of well-being they are able to generate for their constituents. Yet there is not mucb difference in their formal systems of rules and laws. Thus, while there seems to be considerable commonality in the values and aspirations of most human societies, they vary dramatically in terms of their ability to achieve them. Why? At the most basic level, this is the question that the scholars drawn together in this volume seek to address.

The diversity of contributors seem to reach two over-arching conclusions. First, it is not rules per se, but rather the institutional environment that determines whether or not rules will be effective in regulating human behavior. Second, institutions that underpin smoothly functioning, highly prosperous societies are invariably based on providing strong incentives to individuals. Harnessing individuals' talents and abilities for the good of the many requires rewarding individual enterprise and limiting the role of the state to guaranteeing the safety of both life and private property.

While these may seem obvious truths, they have implications for virtually all policy issues, ranging from re-distribution (you must create wealth before you can distribute it), through environmental protection (nothing protects the environment like giving individuals property rights over it) to good government (if government favors can create wealth, resources will be wasted in currying such favors). 'Liberal' academics, whose prescriptions invariably call for government intervention in the economy seem particularly blind to these truths.


Rating: 5 out of 5
Constitutions matter!
This book really got me thinking about the importance of the constitutional underpinnings to our societies. The editors have really gathered together the leading thinkers in the field ranging from Nobel Laureate James Buchanan through scholars like Dennis Mueller and Bruno Frey to Michael Munger.

As Mueller points out, all constitutions contain fine language - even the Soviet constitution sounded quite admirable - but it is the underlying institutions that determine whether they will matter and be a force for good, or merely serve a decorative function. Munger suggests that passing such virtuous institutions from generation to generation are the key to healthy and prosperous societies. This is where ideology can play a role.

Ultimately, societies must harness the spirit of the individual if they are to succeed in the long run. Rowley points out that the role of the state in guaranteeing individual property rights, as recommended by John Locke, will go a long way towards achieving such individual commitment. On the other hand, excessive state intervention as recommended by Thomas Hobbes, will lead to the stifling of individualism and with it the withering of incentives, creativity, prosperity and human well-being.



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