Political Property Rights and Governance Outcomes: A Theory of the Corporate Polity

Journal of Private Enterprise, Forthcoming

26 Pages Posted: 21 Feb 2015 Last revised: 12 Dec 2015

See all articles by Alexander William Salter

Alexander William Salter

Texas Tech University - Rawls College of Business; American Institute for Economic Research

Date Written: December 11, 2015

Abstract

I present a theory of political property rights that serves as a complement to familiar Tiebout mechanisms in explaining governance outcomes. I argue that when the structure of political property rights is such that the polity most closely resembles a business corporation, governance will be largely productive. In contrast, when the structure of political property rights is such that the polity is characterized by a tragedy of the commons, governance will be largely predatory and will promote rent seeking. I illustrate my theory with reference to two corporate-like polities, Singapore and the United Arab Emirates, as well as the literature on private city planning on urban development. I also discuss the assumptions to which my analysis is sensitive, and conclude by exploring possible future trends in governance in light of my theory.

Keywords: Political property rights, predatory governance, private governance, productive governance

JEL Classification: D72, H11, H77, P14, P16

Suggested Citation

Salter, Alexander William, Political Property Rights and Governance Outcomes: A Theory of the Corporate Polity (December 11, 2015). Journal of Private Enterprise, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2567374 or http://dx.doi.org/10.2139/ssrn.2567374

Alexander William Salter (Contact Author)

Texas Tech University - Rawls College of Business ( email )

Lubbock, TX 79409
United States

HOME PAGE: http://awsalter.com

American Institute for Economic Research

PO Box 1000
Great Barrington, MA 01230
United States

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