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Misuse of Institutions: Patterns and Causes

Author

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  • Leonid POLISHCHUK

    (The University of Maryland, USA and State University-Higher School of Economics, Russia)

Abstract

Institutions are often misused, i.e. applied or resorted to for reasons which have little in common with their intended raison d'etre. This paper provides an insight into the origins and causes of institutional misuse and explores the political economy of this phenomenon. We present a typology of misuse of institutions and illustrate it by examples largely drawn from Russian realities. Causes of vulnerability of institution to misuse are discussed. It is argued that institutions are not protected from misuse at the grassroots due to unresolved collective action problem, whereas economic and political elite are either indifferent to misuse of institutions, or perpetrate such misuse by subverting market institutions for the purpose of rent extraction.

Suggested Citation

  • Leonid POLISHCHUK, 2008. "Misuse of Institutions: Patterns and Causes," The Journal of Comparative Economic Studies (JCES), The Japanese Society for Comparative Economic Studies (JSCES), vol. 4, pages 57-80, December.
    • Handle: RePEc:cos:epaper:v:4:y:2008:p:57-80
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    2. Menyashev, Rinat & Natkhov, Timur & Polishchuk, Leonid & Syunyaev, Georgiy, 2011. "New Institutional Economics: A state-of-the-art review for economic sociologists," economic sociology. perspectives and conversations, Max Planck Institute for the Study of Societies, vol. 13(1), pages 12-21.
    3. Dimiter IALNAZOV & Nikolay NENOVSKY, 2010. "The Evolution of Post-Communist Countries: An Interpretation from the Perspective of Cooperation," LEO Working Papers / DR LEO 1600, Orleans Economics Laboratory / Laboratoire d'Economie d'Orleans (LEO), University of Orleans.
    4. Vernikov, Andrei, 2019. "The drivers of institutional change in a post-socialist economy: The case of deposit insurance introduction in Russia," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 11(1), pages 129-143.
    5. L. Polishchuk & E. Borisova & A. Peresetsky., 2010. "Managing Common Property in Russian Cities: An Economic Analysis of Homeowners Associations," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 11.
    6. Dimiter Ialnazov & Nikolay Nenovsky, 2011. "A Game Theory Interpretation of the Post-Communist Evolution," Journal of Economic Issues, Taylor & Francis Journals, vol. 45(1), pages 41-56.
    7. Leonid Polishchuk & Alexander Tonis, 2013. "Endogenous contest success functions: a mechanism design approach," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 52(1), pages 271-297, January.

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    More about this item

    Keywords

    institutions; political economy; legal reform; institutional capture;
    All these keywords.

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

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