Governance Revolution

What is institutional innovation?

Debt/GNP ratios since the late 17th century. Source: Ferguson (2001).
It was important to list the names of the subscribers to achieve successful deterrence.

When to be a radical?

V is the value of the institutional arrangement and Q is its quality. Qs represents the status quo. Institutional reform being a gamble, it could lead to either Ql or Qw. With no exit options, a losing gamble leads to Vl1. In the presence of exit options, a winning gamble leads to Vl2. Without exit options, the gamble is not worth it (negative expected value). With exit options, the gamble becomes worth it. Source.

The shopping mall model

Classical Greece

Renaissance Italy

Colonial America

Exit in a closed world

The future of governance?

Layered governance

Proprietary governance

State-reinforced self-governance

Conclusion

References

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I want to be a lobster too

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