Abstracts from "A Research Agenda for New Institutional Economics" III

By Claude Ménard and Mary M. Shirley

In previous posts, we presented a brief summary and abstracts of three chapters of our forthcoming volume.* The table of contents can be found here. Here are three final abstracts of chapters to give a flavor of the book.

A Mutually Beneficial Relationship: Relational Contracts in Developing Countries

Rocco Macchiavello (London School of Economics)

Imperfect contract enforcement is a pervasive feature of real-life commercial transactions. Consequently trading parties rely on long-term relationships based on trust, reputation, and the promise of future rents, to guarantee contractual performance. Developing countries offer fertile ground for studying such relational contracts (RCs) since the market failures and organizational responses are starker, there are fertile opportunities to test theory isolating confounding factors, and a deeper understanding can help design better policies. This paper reviews recent contributions that highlight the empirical content of RC models, different empirical strategies to test for the presence and quantify the value of RCs in observational data, the interaction between informal RCs and formal governance structures and evidence of how RCs alter market functioning. The paper highlights promising avenues for further research in this exciting area, not only between firms, but within firms and public bureaucracies, between state and other actors, in informal community organizations, etc.

Family and Gender: Questions for the New Institutional Economics

Raquel Fernández (New York University)

This chapter discusses the large variety of research questions that would benefit from a NIE perspective in the area of family and gender. Although the family – the most basic of social organizations -- and the role of women have undergone huge transformations over time, for the most part researchers in the NIE tradition have been silent as to why this has happened and how to explain the cross-country variation we observe. The issues, ranging from the evolution of divorce laws to suffrage extensions to the change in female labor participation and social beliefs about women, are important and would benefit greatly from an approach grounded in history, anthropology, and sociology in addition to economics

Recognizing and Solving Institutional Puzzles

Douglas W. Allen (Simon Frazer University)

What research topics should young institutional scholars pursue in the near future? I don't know. I do know that I've made a career out of finding interesting institutional puzzles and explaining them with testable transaction cost arguments. In this essay, I share the methodology for doing this, which should be common knowledge, but is not.

*A Research Agenda for New Institutional Economics, Claude Ménard and Mary M. Shirley, eds., Edward Elgar Publishers, forthcoming in 2018.