Dynamics and Stability of Constitutions, Coalitions, and Clubs

Author:

Acemoglu Daron1,Egorov Georgy2,Sonin Konstantin3

Affiliation:

1. Department of Economics, Massachusetts Institute of Technology, 50 Memorial Drive, Building E52, Room 380B, Cambridge, MA 02142-1347.

2. Department of Managerial Economics and Decision Sciences, Kellogg School of Management, Northwestern University, 2001 Sheridan Rd., Jacobs Center, Room 539, Evanston, IL 60208.

3. New Economic School, 47 Nakhimovsky prosp., Office 922, Moscow, 117418, Russia.

Abstract

In dynamic collective decision making, current decisions determine the future distribution of political power and influence future decisions. We develop a general framework to study this class of problems. Under acyclicity, we characterize dynamically stable states as functions of the initial state and obtain two general insights. First, a social arrangement is made stable by the instability of alternative arrangements that are preferred by sufficiently powerful groups. Second, efficiency-enhancing changes may be resisted because of further changes they will engender. We use this framework to analyze dynamics of political rights in a society with different types of extremist views. (JEL D71, D72, K10)

Publisher

American Economic Association

Subject

Economics and Econometrics

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