Informal Institutions and Development

Raj Navanit Patel, University of Pennsylvania

Abstract

Why are some countries wealthier than others? Recent scholarship on this question has begun to converge on the answer to this question: institutions. Some countries are wealthier than others, on this view, because they have the right institutions. These are a set of well-functioning institutions that allow individuals in society to cooperate and coordinate with each other, and, in the end, secure the welfare gains from that cooperation and coordination. Institutions matter, in other words. But which institutions? In this dissertation, I argue that it is the presence of particular informal institutions (such as social norms) in some societies, and their absence in others, that ultimately decides whether cooperation and coordination is achieved, and welfare gains are secured. I argue that the historical focus on formal institutions (such as formal laws and regulations) is somewhat misplaced, since whether or not people abide by formal institutions is determined by the presence of particular informal rules and norms that govern everyday interaction. In a nutshell: formal institutions matter, but informal institutions rule.

Subject Area

Philosophy|Philosophy of Science

Recommended Citation

Patel, Raj Navanit, "Informal Institutions and Development" (2020). Dissertations available from ProQuest. AAI27961411.
https://repository.upenn.edu/dissertations/AAI27961411

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