A Theory of Complementary Institutions
نویسنده
چکیده
To solve problems of compliance, an institutional trigger mechanism is often used. This paper develops a model of two trigger mechanisms and derives conditions where the two institutions may complement one another to improve utility and compliance. When the conditions for optimality do not hold, small changes in institutional structure may create lumpy changes in behavior. Also, the paper explores the consequences of politically-determined institutions. The paper illustrates the model with applications to administrative theory, common pool resource problems, and federalism. 1You are reading work in progress. I’d love feedback. Ethan Bueno de Mesquita, Jay Dow, Tracey George, and Scott Page kindly provided comments and encouragement on this project.
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