Coping with unpleasant surprises in a complex world: Is rational choice possible in a world with positive information costs?

This paper provides a rational choice-based analysis of the causes and consequences of surprise events. The paper argues that ignorance may be rational, but nonetheless produce systematic mistakes, inconsistent behavior, and both pleasant and unpleasant surprises. If ignorance and unpleasant surprises are commonplace and relevant for individual and group decisionmaking, we should observe standing institutions for dealing with them - and we do. Insofar as surprises are consistent with rational choice models, but left outside most models, it can be argued that these methodological choices mistakenly limit the scope of rational choicebased research. --Ignorance,Rational Ignorance,Natural Ignorance,Bounded Rationality,Rational Choice,Biased Expectations,Crisis Management,Social Insurance,Bailouts,Economics of Information

Democracy in America: Labour Mobility, Ideology , and Constitutional Reform

Constitutional democracy in the United States emerged very gradually through a long series of constitutional bargains in the course of three centuries. No revolutions or revolutionary threats were necessary or evident during most of the three century–long transition to constitutional democracy in America. As in Europe, legislative authority gradually increased, wealth-based suffrage laws were gradually eliminated, the secret ballot was introduced, and the power of elected officials increased. For the most part, this occurred peacefully and lawfully, with few instances of open warfare or revolutionary threats. A theory of constitutional exchange grounded in rational choice models provides a good explanation for the distinctive features of American constitutional history, as it does for much of the West, although it does less well at explaining the timing of some changes

On the Evolution of Organizational Governance: Divided Governance and Survival in the Long Run

This paper analyzes the formation, refinement, and evolution of organizational decisionmaking processes, e.g. organizational governments. In doing so, it develops a framework for analyzing a broad cross section of private and non-private formal organizations. Formal organizations are all founded, e.g. they have a beginning. As a consequence, decisionmaking authority within an organization is often initially distributed in a manner that provides their founders (formeteurs) with substantial control over their organizations. However, that control is rarely, if ever, complete, because formeteurs have interests that can often be advanced by trading and/or delegating authority to others in exchange for services and other resources that increase organizational surplus. The result tends to be divided, rule-based, governance based on the king and council template

The Logic of Collective Action and Beyond

This article provides an overview of Mancur Olson’s Logic of Collective Action and its impact on Olson’s subsequent work. It also suggests that the implications of his simple, elegant, theory have not yet been fully worked out. To illustrate this point, the second half of the essay demonstrates that the number of privileged and latent groups and their costs in a given society are not entirely determined by economic factors or group size alone. Politics, technology, and culture also matter

Constitutional Bargaining, Eminent Domain, and the Quality of Contemporary African Institutions: A Test of the Incremental Reform Hypothesis

According to the incremental reform hypothesis, constitutions are rarely adopted whole cloth; thus the starting point, scope for bargaining, and number of reforms, jointly determine the trajectory of constitutional history. We test the relevance of this theory for Africa by analyzing the formation and reform of the independence constitutions negotiated and adopted during the 1950s and early 1960s. We find historical evidence that independence occurred incrementally and that the African countries that experienced the fewest constitutional moments and narrowest domain of bargaining after independence have better contemporary institutions than states that began with less restrictive constitutional rules and experienced more constitutional moments

A Test of the Institutionally Induced Equilibrium Hypothesis: On the Limited Fiscal Impact of Two Celebrity Governors

We test for the stabilizing effects of political institutions on fiscal policies by examining the impact of two unlikely governors on their state’s fiscal policies. Fiscal policies are joint products of executive and legislative decisions. These institutional factors tend to moderate the effect of changes in the chief executive, as does partisan competition for office. Jesse Ventura of Minnesota’s and Arnold Schwarzenegger of California were unique—surprise—governors of their respective states. Although both governors were arguably less constrained by partisan loyalties than most others, the other institutional factors would still tend to limit their impact on public policy. Our evidence suggests that in spite of their unique path to office neither governor had a significant impact on their state’s expenditures or deficits

Voter discernment and candidate entry in pluralitarian election

The paper develops a sequential model of candidate entry into elections decided on the basis of plurality. We analyze the kinds of candidates who are most likely to enter elections and simulate several plausible myopic entry sequences under various assumptions about voter abilities to discern differences in candidate positions. In the cases examined, open elections for “important” positions attract the entry of more than two candidates. Moreover, myopic entry often generates electoral outcomes which depart from the median-mean outcomes of the conventional models. These results are consistent with the observed diversity of candidates in presidential and other significant primary elections which contrasts with many previous analyses of electoral entry

2010,09: On the evolution of organizational government

This paper analyzes the design, refinement, and evolution of organizational policymaking processes, that is to say, organizational governance. Governance procedures like other aspects of organization are refined through time to advance formeteur interests. Several mechanisms of evolution are explored in this paper. First, formal organizations have a beginning. They are founded. As a consequence, governance templates initially tend to maximize formeteur control over their organizations. Second, formeteurs may subsequently revise the initial distribution of authority. There are often good reasons for formeteurs to exchange some of their initial authority for services and resources that advance organizational interests. Third, there are the constraints of survivorship, which require an organization to attract sufficient resources to be self sustaining. This paper suggests that the results of these processes of refinement tend to be ruledriven, divided governments, many of which will be based on the king and council template. That template facilitates the emergence of relatively effective forms of organizational governance, because it can be adjusted at a large number of margins without changing the essential architecture of governance