National Theory

Author: [USA] Yoram Barzel
Publisher:
Publish Date: 2006-07-01
Features: This book models the birth of the state and the forces that shape it. The origin of the state stems from the need for protection. Professional protectors—the rulers—are efficient and self-interested. Rulers are only deployed when individuals create mechanisms to control them. The branches of organized protection are the legal system and decision-making procedures (including voting). Thus, the initial "natural state" gradually evolves into a rule-of-law state. The state endows individuals with rights by defining the scope of protection. However, implementation is never perfect. People also use other third parties—such as firms—to enforce agreements. The combination of implementation methods chosen in practice determines the scale of state policy and the characteristics of the state. As products become standardized, the scale economies of contracting also increase. We argue that the state expands its contracting enforcement domain through treaties or conquest to exploit domestic implementation economies. The demand to expand the contracting enforcement domain also explains the rise of rule-of-law empires.