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Competition among Institutions
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444 b
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On the brink of the 21st century, the highly-developed economies of Europe and North America are facing similar problems: the density of regulations constraining economic activity has increased considerably and the public share of the gross national product has augmented rapidly. Economists generally accept that competition discloses knowledge, enhances efficiency and restrains power. However, these effects of competition have so far been discussed mainly with respect to economic markets in which firms and households compete within a given set of institutions, that is within a given legal order. The question arises whether competition may also have comparable effects on the institutional level in the sense of competition among legal orders and thus serve as an antidote to today's problems. This book addresses some of the fundamental aspects associated with institutional competition and identifies some possible lines for further research on how institutions can compete to bring about social and economic change.
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