Issues of institutional persistence and institutional changes

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Date
2023
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Ivane Javakhishvili Tbilisi State University Press
Abstract
The issue of institutional persistence and institutional changes is one of the relevant parts of institutional economics. Institutional changes aim to adapt new challenges. Herewith, as for the persistence of institutions, it is important to encourage economic development. However, we should note that the institutions, which persist over time, in particular, can no longer support changes and economic development. The paper analyzes the factors that prevent institutional change, give a push to inertia and reduce the potential of systemic development. Analysis of the issue revealed that among other factors, three important mechanisms determine the sustainability of institutions. These are - geography, culture and history. In addition, the simplest form of institutional stability is ~institutional stasis,~ which implies that the maintenance of existing institutions is because ~power begets power.~ This means that existing institutions currently allow powerful groups to continue to dominate, so that those groups in turn may choose to maintain those institutions. However, ultimately, all authors agree that despite such examples, institutional stasis is rare; most institutions are constantly changing, and institutional change is an integral part of the economic development.1. Acemoglu, Daron, Georgy Egorov and Konstantin Sonin. 2021. “Institutional change and institutional Persistence.” NBER Working Paper No. 27852 2. Acemoglu, Daron and James A Robinson. 2001. “A Theory of Political Transitions.” American Economic Review 91(4):938–963. 3. Acemoglu, Daron and James A Robinson. 2006b. Economic Origins of Dictatorship and Democracy. Cambridge University Press. 4. Acemoglu, Daron and James A Robinson. 2001. “A Theory of Political Transitions.” American Economic Review 91(4):938–963. 5. Acemoglu, Daron and James A. Robinson. 2012. Why Nations Fail: The Origins of Power, Prosperity, and Poverty. New York: Crown Publishers. 6. Bertocchi, G. and Canova, F. (2002) “Did Colonization Matter for Growth: An Empirical Exploration into the Historical causes of Africa’s Underdevelopment” European Economic Review. 46, 1851-1871. 7. Diamond, J. (1997) Arms, Germs and Steel. W. W. Norton. 8. Engerman, S. and Sokoloff, K. (1997) “Factor Endowments, Institutions and Differential Paths of Growth among New World Economies: A View from Economic Historians of the United States”, in S. Haber, Ed. How Latin America Fell Behind: Essays on the Economic Histories of Brazil and Mexico. Standford University Press. 9. Engerman, S. and Sokoloff, K. (2005) “The Evolution of Suffrage Institutions in the New World” Journal of Economic History. 65, 891-921. 10. Fernandez, R. (2010) “Does Culture Matter?” Working Paper, Department of Economics, New York University. 11. Fischer, Stanley. 1994. Russia and the Soviet Union Then and Now. University of Chicago Press pp. 221–258. 12. Fishman, R. and Miguel E. (2007) “Corruption, Norms, and Legal Enforcement: Evidence from Diplomatic Parking Tickets” Journal of Political Economy. 115, 1020-1048. 13. Gallup, J. and Sachs, J. (1999) “Geography and Economic Development”. Working Paper N1, Center for International Development. 14. Grier, R. (1999) “Colonial Legacies and Economic Growth” Public Choice. 98, 317-335. 15. Guiso, L; Sapienza, P and Zingales: L. (2006) “Does Culture Affect Economic Outcomes?” Journal of Economic Perspectives. 20, 23-48. 16. Guiso, L; Sapienza, P and Zingales: L. (2009) “Cultural Biases in Economic Exchange” Quarterly Journal of Economics. 124, 1095-1131. 17. Jellema, J. 92010) “Culture and Development” Mimeo. 18. Landes, D. (2006) “Why Europe and the West? Why Not China?” Journal of Economic Perspectives. 20, 3-22. 19. Licht, A; Goldschmidt, C; nd Schwarts, S. (2007) “Culture Rules: The Foundations of the Rule of Law and other Norms of Governance” Journal of Comparative Economics. 35, 659-688. 20. Mahoney, James. 2000. “Path dependence in historical sociology.” Theory and society 29(4):507–548. 21. Papava, V. On the Shadow Political Economy of the Post-Communist Transformation. An Institutional Analysis. Problems of Economic Transition, Vol. 40, No. 6, 1997 (co-author N.Khaduri). 22. Kakulia, N., Lazarashvili, T. (2019). Institutional transformation and its challenges in Georgia. Ivane Javakhishvili Tbilisi State University, The collection of The 4th International Scientific-Practical Conference Materials, 173-178 (In Georgian).
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1. Acemoglu, Daron, Georgy Egorov and Konstantin Sonin. 2021. “Institutional change and institutional Persistence.” NBER Working Paper No. 27852 2. Acemoglu, Daron and James A Robinson. 2001. “A Theory of Political Transitions.” American Economic Review 91(4):938–963. 3. Acemoglu, Daron and James A Robinson. 2006b. Economic Origins of Dictatorship and Democracy. Cambridge University Press. 4. Acemoglu, Daron and James A Robinson. 2001. “A Theory of Political Transitions.” American Economic Review 91(4):938–963. 5. Acemoglu, Daron and James A. Robinson. 2012. Why Nations Fail: The Origins of Power, Prosperity, and Poverty. New York: Crown Publishers. 6. Bertocchi, G. and Canova, F. (2002) “Did Colonization Matter for Growth: An Empirical Exploration into the Historical causes of Africa’s Underdevelopment” European Economic Review. 46, 1851-1871. 7. Diamond, J. (1997) Arms, Germs and Steel. W. W. Norton. 8. Engerman, S. and Sokoloff, K. (1997) “Factor Endowments, Institutions and Differential Paths of Growth among New World Economies: A View from Economic Historians of the United States”, in S. Haber, Ed. How Latin America Fell Behind: Essays on the Economic Histories of Brazil and Mexico. Standford University Press. 9. Engerman, S. and Sokoloff, K. (2005) “The Evolution of Suffrage Institutions in the New World” Journal of Economic History. 65, 891-921. 10. Fernandez, R. (2010) “Does Culture Matter?” Working Paper, Department of Economics, New York University. 11. Fischer, Stanley. 1994. Russia and the Soviet Union Then and Now. University of Chicago Press pp. 221–258. 12. Fishman, R. and Miguel E. (2007) “Corruption, Norms, and Legal Enforcement: Evidence from Diplomatic Parking Tickets” Journal of Political Economy. 115, 1020-1048. 13. Gallup, J. and Sachs, J. (1999) “Geography and Economic Development”. Working Paper N1, Center for International Development. 14. Grier, R. (1999) “Colonial Legacies and Economic Growth” Public Choice. 98, 317-335. 15. Guiso, L; Sapienza, P and Zingales: L. (2006) “Does Culture Affect Economic Outcomes?” Journal of Economic Perspectives. 20, 23-48. 16. Guiso, L; Sapienza, P and Zingales: L. (2009) “Cultural Biases in Economic Exchange” Quarterly Journal of Economics. 124, 1095-1131. 17. Jellema, J. 92010) “Culture and Development” Mimeo. 18. Landes, D. (2006) “Why Europe and the West? Why Not China?” Journal of Economic Perspectives. 20, 3-22. 19. Licht, A; Goldschmidt, C; nd Schwarts, S. (2007) “Culture Rules: The Foundations of the Rule of Law and other Norms of Governance” Journal of Comparative Economics. 35, 659-688. 20. Mahoney, James. 2000. “Path dependence in historical sociology.” Theory and society 29(4):507–548. 21. Papava, V. On the Shadow Political Economy of the Post-Communist Transformation. An Institutional Analysis. Problems of Economic Transition, Vol. 40, No. 6, 1997 (co-author N.Khaduri). 22. Kakulia, N., Lazarashvili, T. (2019). Institutional transformation and its challenges in Georgia. Ivane Javakhishvili Tbilisi State University, The collection of The 4th International Scientific-Practical Conference Materials, 173-178 (In Georgian). 23. Kakulia, Nazira & Zhghenti, Tsotne. (2019). Institutional-Determinants-of-Economic-Growth-in-Georgiaand- in-Other-Post-Communist-Economies. World Academy of Science, Engineering and Technology International Journal of Economics and Management Engineering Vol:13, No:5, 2019 24. Roland, Gerard. 1991. “The Political Economy of Transition in the Soviet Union.” European Economy 49:197–216. 25. Sachs, J (2003) ‘Institutions Don’t Rule: Direct Effects of Geography on Per Capita Income” NBER Working Paper N 9490. 26. Sachs, J and Andrew Warner; 2001. ‘The curse of natural resources“. European Economic Review, 2001, vol. 45, issue 4-6, 827-838. 27. Spolare, E. and Wacziarg, R. (2009) “The Diffusion of Development” Quarterly Journal of Economics. 124, 469-529. 28. Treisman, Daniel. 2011. The Return: Russia’s Journey from Gorbachev to Medvedev. Free Press. 29. Thelen, Kathleen. 1999. “Historical institutionalism in comparative politics.” Annual review of political science 2(1):369–404. 30. Wallis, J. (2010) “Persistence and Change: The Evolution of Douglass C. North” Mimeo. 31. Wiener, Jonathan M. 1978. Social Origins of the New South: Alabama, 1860-1885. Louisiana State University Press. 32. Woodward, C. Vann. 1955. The Strange Career of Jim Crow. Oxford University Press. 33. Wright, Gavin. 2013. Sharing the Prize. Harvard University Press.
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Conference Proceedings: "The World Economy in the Post-Pandemic Period: Implications and Challenges", Tbilisi, 2023, pp. 132-137
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