Institutions First

Journal of Institutional Economics, Forthcoming

7 Pages Posted: 8 Dec 2010 Last revised: 23 Jan 2011

See all articles by Peter J. Boettke

Peter J. Boettke

George Mason University - Department of Economics; Mercatus Center at George Mason University

Alexander Fink

University of Leipzig

Date Written: January 20, 2011

Abstract

Chang (2011) raises doubts about the effects of institutions on economic development and questions the positive effects of entirely free markets based on secure private property rights. We respond by stressing that institutions structure the incentives underlying individual action, secure private property rights are indispensable for prosperity, institutions have a first-order effect whereas policies only have a second-order effect, successful institutional change comes from within a society, and given the status quo of developing countries first-world institutions are likely not to be available to them.

Keywords: Institutions, Economic Development, Property Rights

JEL Classification: O12, O40, P48, D02

Suggested Citation

Boettke, Peter J. and Fink, Alexander, Institutions First (January 20, 2011). Journal of Institutional Economics, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1721157

Peter J. Boettke

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
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Mercatus Center at George Mason University ( email )

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Arlington, VA 22201
United States

Alexander Fink (Contact Author)

University of Leipzig ( email )

Grimmaische Str. 12
Leipzig, 04109

HOME PAGE: http://www.alexander-fink.com

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