Posted by Randy Barnett:
Anarchy and Development: An Application of the Theory of Second Best:
http://volokh.com/archives/archive_2009_07_26-2009_08_01.shtml#1248789179
I have not yet read [1]Anarchy and Development: An Application of the
Theory of Second Best by Peter T. Leeson & Claudia R. Williamson, but
the title and abstract sound interesting:
Could anarchy be a constrained optimum for weak and failing states?
Although a limited government that protects citizens' property
rights and provides public goods may be the first-best governance
arrangement for economic development, among the poorest nations
such "ideal political governance" is not an option. LDCs face a
more sobering choice: "predatory political governance" or no
government at all. Many predatory governments do more to damage
their citizens' welfare than to enhance it. In light of this, we
show that conditional on failure to satisfy a key institutional
condition required for ideal political governance�constrained
politics�citizens' welfare is maximized by departing from the other
conditions required for this form of governance: state-supplied law
and courts, state-supplied police, and state-supplied public goods.
Since departing from these conditions produces anarchy and
fulfilling them when government is unconstrained producers
predatory political governance, anarchy is a second best.
(H/T Nate Oman via FB)
References
1.
http://www.facebook.com/ext/share.php?sid=133491060812&h=JY_bM&u=ZQyHn&ref=nf
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