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National Integration and Institution Building

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  • Zhou, Haiwen

Abstract

The mutual dependence between national integration and institution building is established in a formal model. It is shown that a decrease in transportation costs, but not necessarily an increase in population size, reduces the equilibrium number of states and the adoption of rule-based institutions. With endogenous transportation costs or endogenous population size, the unification process can feed on itself. The model is illustrated by the state of Qin’s unification of China in 221 BC. During this process of national integration, transformations from relation-based governance to rule-based governance happened.

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  • Zhou, Haiwen, 2023. "National Integration and Institution Building," MPRA Paper 116152, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:116152
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    References listed on IDEAS

    as
    1. Haiwen Zhou, 2021. "Culture, institutions, and long‐run performance," Pacific Economic Review, Wiley Blackwell, vol. 26(3), pages 372-391, August.
    2. Jordan Adamson, 2021. "The scope of political jurisdictions and violence: theory and evidence from Africa," Public Choice, Springer, vol. 186(3), pages 467-490, March.
    3. Avinash Dixit, 2003. "Trade Expansion and Contract Enforcement," Journal of Political Economy, University of Chicago Press, vol. 111(6), pages 1293-1317, December.
    4. Haiwen Zhou, 2004. "The division of labor and the extent of the market," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 24(1), pages 195-209, July.
    5. Shuhei Kitamura & Nils-Petter Lagerlöf, 2020. "Geography and State Fragmentation," Journal of the European Economic Association, European Economic Association, vol. 18(4), pages 1726-1769.
    6. Haiwen Zhou, 2012. "Internal Rebellions and External Threats: A Model of Government Organizational Forms in Ancient China," Southern Economic Journal, John Wiley & Sons, vol. 78(4), pages 1120-1141, April.
    7. Alesina, Alberto & Spolaore, Enrico, 2005. "War, peace, and the size of countries," Journal of Public Economics, Elsevier, vol. 89(7), pages 1333-1354, July.
    8. Wolfgang Keller & Carol H. Shiue, 2020. "Market integration and institutional change," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 156(2), pages 251-285, May.
    9. Haiwen Zhou, 2014. "Intermediate Inputs and External Economies," Frontiers of Economics in China-Selected Publications from Chinese Universities, Higher Education Press, vol. 9(2), pages 216-239, June.
    10. Ma, Debin & Rubin, Jared, 2019. "The Paradox of Power: Principal-agent problems and administrative capacity in Imperial China (and other absolutist regimes)," Journal of Comparative Economics, Elsevier, vol. 47(2), pages 277-294.
    11. Haiwen Zhou, 2009. "Population Growth And Industrialization," Economic Inquiry, Western Economic Association International, vol. 47(2), pages 249-265, April.
    12. Haiwen Zhou, 2012. "Internal Rebellions and External Threats: A Model of Government Organizational Forms in Ancient China," Southern Economic Journal, John Wiley & Sons, vol. 78(4), pages 1120-1141, April.
    13. Haiwen Zhou, 2011. "Confucianism and the Legalism: A model of the national strategy of governance in ancient China," Frontiers of Economics in China, Springer;Higher Education Press, vol. 6(4), pages 616-637, December.
    14. Haiwen Zhou, 2022. "The Choice of Technology and Economic Geography," International Economic Journal, Taylor & Francis Journals, vol. 36(1), pages 1-18, January.
    15. Steven C. Salop, 1979. "Monopolistic Competition with Outside Goods," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 141-156, Spring.
    16. Hicks, J. R., 1969. "A Theory of Economic History," OUP Catalogue, Oxford University Press, number 9780198811633.
    17. Haiwen Zhou, 2018. "A Model of Institutional Complementarities in Ancient China," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 44(2), pages 286-304, April.
    18. Fali Huang, 2013. "Contract Enforcement: A Political Economy Model of Legal Development," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 29(4), pages 835-870, August.
    19. John Shuhe Li, 2003. "Relation‐based versus Rule‐based Governance: an Explanation of the East Asian Miracle and Asian Crisis," Review of International Economics, Wiley Blackwell, vol. 11(4), pages 651-673, September.
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    Cited by:

    1. Haiwen Zhou, 2023. "Unification and Division: A Theory of Institutional Choices in Imperial China," Annals of Economics and Finance, Society for AEF, vol. 24(1), pages 13-37, May.
    2. Haiwen Zhou, 2024. "The Reforms of Shang Yang," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 180(4), pages 626-647.

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    More about this item

    Keywords

    National integration; institution building; China; rule-based governance; optimal size of nations;
    All these keywords.

    JEL classification:

    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • N45 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Asia including Middle East
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General

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