We examine whether the differences in the legal origins of countries (Common Law versus Civil Law) can explain the variations in the price efficiencies of the stock markets of different countries. Based on multifractal detrended fluctuation analysis of the daily stock indices of 34 countries over 21 years, we find that the stock price indices in Common Law origin countries show greater price efficiency than the stock price indices in Civil Law countries. These results provide additional evidence that the legal origins of countries affect their economic activities and outcomes.

This review article looks back at the first ten years of one of the most contentious elements of the global economy's new institutionalized governance regime. It examines the global political economy of protecting intellectual property, focusing on some key issues regarding the extension of such protection into the economies of developing countries, as discussed in three recent books. The review concludes that, for institutional economics, the problem of intellectual property is the problem of institutionalizing property rights writ large. As such, the problem of intellectual property in the global political economy can only be fully understood by establishing the historical and institutional context in which these rights are claimed.

This paper advances a pre-colonial institutional thesis to explain the variation in the salience of ethnicity in African societies. It posits that pre-colonial political centralization facilitated the accumulation of economic and institutional advantages, positioning descendants of centralized ethnic groups to benefit from these advantages within postcolonial states. Social identity choices are rational; therefore, descendants of centralized ethnic groups, who enjoy greater advantages within the nation, find less incentive to choose their ethnicity over their national identity. Examples from Ethiopia and Ghana as well as the evidence from combining individual-level survey data from the Afrobarometer with historical data on pre-colonial political centralization support the theoretical claim. In particular, the paper presents both theory and evidence indicating that individuals with ancestors from politically centralized pre-colonial societies are less likely to favour their ethnic identity over their national identity . These findings underscore the importance of considering pre-colonial legacies when promoting national unity.

The paper examines the legacy of pre-colonial centralization on tax compliance norms of citizens in contemporary Uganda. Using a regression discontinuity analysis on neighboring ethnic homelands with different levels of pre-colonial centralization, we find that pre-colonial centralization is correlated with stronger norm for tax compliance. The result is explained by the legacy of location-specific capacity of centralized states in upholding authority and a strong social cohesion exhibited through higher interpersonal trust but not through trust in public institutions.

Habraken's Structure of the Ordinary (SOTO), Jacobs' view of cities, and Ostrom's Design Principles and Institutional Analysis and Development (IAD) framework focus on essential elements and relationships for the effective governance of the environment. However, they have different perspectives about what is necessary for successful governance. This article compares and contrasts Habraken's, Jacobs', and Ostrom's views and applies them to Common Interest Developments (CIDs). Habraken, Jacobs, and Habraken discuss the importance of public territory. Habraken views public territory as relative: a territory in a built environment can be private relative to a larger, or higher level, territory, and public relative to an included, lower level, territory. Jacobs discusses the importance of connections and accommodating strangers without sacrificing safety. Ostrom views common-pool resources as goods whose use causes less to be available to others. For their part, CIDs represent a particular governance vehicle for defining what is public and private in large residential developments. For both Habraken and Ostrom, the transformation of the physical environment reflects agents' common values constrained by material, technical, cultural, and economic conditions. Rather than one mutual understanding, Jacobs wrote that balancing the commercial and the guardian values is crucial for society's health and survival.

The current approach to the study of property cannot distinguish the causes of human action from the consequences of human action. It also cordons off morality thereby opening a hole in how property rights work. The scientific difficulty is that our analysis must constantly shift between the individual, their local community, and the larger polity in which both are embedded, in order to explain simultaneously different levels of consequences with different kinds of causes. The difficulty is made worse when we construct mental models without the human mind. My framework leaves the human mind in. Since Armen Alchian and Harold Demsetz, the study of property rights has had a decidedly external stance: the institution imposes itself on the individual from the outside. The problem of property rights, however, also calls for inquiry from the inside out of human agency, because in the study of property, ideas are primary.

A growing number of labour market participants transact through gig platforms. This choice should reflect a reduction in transaction costs for platform users, compared to costs they meet when using alternative modes of governance. We exploit a unique cross-platform, cross-country data set of gig platform users to test the impact of the institutional environment in one of its dimensions – the strictness of labour market regulation (LMR) – on the ability of gig platforms to reduce users' transaction costs. According to our findings, the regulation indicator of both the user and platform countries influences transaction costs for platform users, even controlling for platform and user characteristics. The platform appears to reduce transaction costs most when users face stricter or weaker LMR, in a U-shaped effect. In the former case, the platform may provide an escape from labour regulations when hiring for tasks, while in the latter case, the platform can economize on the usual transaction costs of private contracting by administrating some types of users' activities.

The objective of this paper is to recall the forgotten opposition of Clément Juglar to the colonization of Algeria, the originality of this position, and his contributions to the genesis of analysing colonial institutions. Juglar was not a theoretician of colonialism, but a liberal economist who rejected the process of colonization on economic grounds. This paper provides evidence that conventional wisdom on French colonialism is indebted to his work. The issues of capital returns in the colonies, French colonialism as mercantilism and protectionism, and the role of colonial institutions in economic development were all addressed by Juglar. He identified property rights and colonial institutions as central issues in his explanation of the predictable failure of colonialism, and in doing so he can be regarded as a forerunner of neo-institutionalist analysis of colonialism.

North (1994) famously remarked that ‘it is the polity that defines and enforces property rights’. This paper traces the development of property rights in Poland and Ukraine and explores their divergence over the past three centuries using North's framework of economic calculation. In each country, the distribution of political power and political institutions had a profound impact on property rights. Indeed, while it was the Polish polity that defined the evolution of property rights from 1386 to 1795 and then from 1989 onward, due to diffusion of power, it was Ukrainian politicians that controlled the destiny of property rights for most of Ukraine's history. This situation has not changed despite the Maidan revolution in Ukraine, and recent moves in Poland show how tenuous property rights are in the face of political opposition.

This introduction to the special issue in honor of Professor Yoram Barzel provides an overview of his scholarship and a summary of the contributions to this special issue. Each contribution advances or elaborates upon major themes in Barzel's theoretical and applied work on property rights, transaction costs, and political economy. The contributions fall into three categories: an examination of the foundations and implications of the ‘Barzelian’ method for social scientific analysis; Barzel's economics of property rights and transaction costs to historical case studies; and advances to Barzel's theory of the state, which includes an analysis of the origins of democracy and the rule of law.

In her ‘Markets, repugnance, and externalities’ (2022), Kimberly Krawiec notes that the so-called corruption theorists fail to provide evidence that the adoption of repugnant behaviours or commodification destroy social values. She adds that, the values repugnant behaviours are supposed to destroy may even be reinforced after a market has been created. The explanation she explores is that the creation of a market never goes without debates that allow the society to ponder the values it stands for. We suggest an alternative view on the lack of evidence Krawiec identifies. Our starting point is Krawiec's interpretation of repugnance in terms of externalities. We claim that an analysis of repugnance based on externalities requires a characterization of what an externality is, which is rarely done. We show that economists use two opposed definitions of externalities, an objective and a subjective one, and then show what it implies for an analysis of repugnance and justify why the corruption thesis is not always verified empirically.

The economic crisis experienced by many developed countries over the past decade saw the emergence of the phenomenon of so-called recovered firms (RFs), or employee buyouts of failed capitalist firms (CFs). While it is obvious that one of the objectives sought by these workers is to keep their jobs, the subsequent performance of these firms is unclear. Are RFs more likely to fail than other worker managed firms (WMFs) or than CFs? Do RF workers get higher incomes than their peers in other WMFs or in CFs? This analysis is based on a linked employer–employee panel data set from Uruguayan social security administrative records. The main findings are that RFs survive longer than other WMFs or than CFs. However, RF workers receive incomes lower than those of their peers at other WMFs or at CFs. This income differential is explained partly by a brain drain process and specific human capital losses.

For some 25 years in revolutionary Haiti, most of the productive land was nationalized and run as state property. This paper shows that this economic system can be accurately described as agrarian socialism. Its life and death are compared with the experiences of 20th-century socialist regimes and their transition to a market economy, paying special attention to the kindred case of São Tomé. Haitian socialism is interesting because it was the unintended, accidental product of an emergency situation: the killing or flight of all the French landlords, which made their land vacant property and drove the state to run it in the public interest to defend the revolution. Therefore, it can be read as a natural experiment in socialism in the absence of a socialist ideology and of a socialist party that could hold the system together, constrain its income distribution, and control its eventual privatization.

Economic sociology was a core concern of early political economists like Smith, Marx, Pareto, and Marshall. The new economic sociology has sought to revive the neglected subdiscipline using the construct of interpersonal networks. Richard Swedberg has assembled 42 substantial papers in this collection. This article, reviewing his selection, proceeds in three stages. First, it provides a general framework for the debate. Second, it discusses the papers specifically linked to networks. Third, it analyses the contributions that go beyond the concept of social processes as personal relationships.

In this essay, we honour the memory of Oliver Williamson by reflecting on Chiles and McMackin's 1996 Academy of Management Review article ‘Integrating variable risk preferences, trust, and transaction cost economics’. The article, which built on Williamson's work in transaction cost economics (TCE), went on to attract attention not only from the authors’ home discipline of management and organisation studies, but also from other business disciplines, the professions and the social sciences. After revisiting the article's origins and core arguments, we turn to selectively (re)view TCE's development since 1996 through the lens of this article, focusing on trust, risk and subjective costs. We cover conceptual and empirical developments in each of these areas and reflect on how our review contributes to previous debates concerning trade-offs implicit in relaxing TCE's behavioural assumptions. We conclude by reflecting on key points of learning from our review and possible implications for future research.

This paper undertakes a descriptive analysis of changes in economic institutions across countries from 2000 to 2016, using Economic Freedom of the World and the “State Economic Modernity” index. This latter index is a recent creation, similar conceptually to state capacity, measuring what can variously be thought of as state building, effectiveness, and economic power. These two indexes are used in concert with one another to classify countries into eight directions of institutional change. Despite recent pessimism, countries besides those at the top world income bracket have continued to liberalize, while wealthy countries have merely stagnated. At the high level aggregates, there is little movement in state economic modernity over this period, although there is considerably heterogeneity among individual countries. Of those measured, Rwanda is the single country to make the greatest movement toward the development benchmark of “Getting to Denmark.”

Posner's economics of organization yields an unconventional view that private organizations operating in the market, the publicly held US business corporation, despite the profit motive, ends up being inefficient, paying excessive compensation to CEOs, while some public organizations, the US federal judicial system (and the judicial system of Continental Europe and Japan), despite the insulation of judges from most of incentives and the near complete autonomy afforded to them, works reasonably well. Unfortunately, Posner does not state clearly the criteria by which he judges one ‘excessive’ and the others ‘works reasonably well’, nor does he explain well why professional norms of judges that play a crucial role in public organizations are not a factor in business organizations.

This paper argues that the degree to which a given industry's labor contracts are complete or incomplete is the major factor determining whether its workforce will be unionized. For instance, assembly line industries feature complete labor contracts because of the nature of the production technology: Either a worker keeps up with the line, or he does not. In such a situation, there is no chance for a reciprocal gift exchange under which firms offer high wages in exchange for high effort levels. The result is low wages that make workers prone to unionization. By contrast, jobs that feature incomplete contracts (lawyers, computer programmers, economists) already have reciprocity and gift exchange in place. Such benefits guarantee to workers that their better interests will be looked after by a management that wishes to maintain a positive and productive labor–management interaction.

While regulation is increasingly relied upon to address economic and social issues in developed economies, research has yet to examine the impact of the growing use of regulation on the courts. This paper explores the relationship between regulation and criminal judicial enforcement. Data regarding regulatory cases and defendants filed in U.S. district courts and regulation at the U.S. federal level are analyzed. The results suggest that increased reliance on regulation leads to growth in regulatory court cases and defendants filed. These findings imply that the courts continue to play an important role when regulation is employed to address problems and that the courts might experience increasing responsibilities as the use of regulation grows. Additionally, the results suggest that the relationship between regulation and the courts should be considered in the design and implementation of regulation in practice.