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People Icons for Vista
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 People Icons for Vista

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Legislations, justice and defence, is the core Deep source of a civilisation "(48, with. 24). As a result Huge economy on scales at the centralised Manufacture of the public blessings and services immeasurably increase The sizes of a division of labour and volume of an exchange, paternal win All members of a society. State problems appear, hence, The inconsistent: "the Second problem assumes completely Effective set of the property rights for the purpose of maximisation Cumulative product of a society; the first conducts to attempts To specify such set of fundamental rules, which Would allow the governor to maximise the income (or, if We wish to weaken the precondition about the individual governor, - To maximise the exclusive rent of group or a class, whose As the agent the governor) "(48 acts, with. 24 - 25). Concrete forms of the government will be defined Those restrictions (first of all - transaction costs), in Which it it is compelled to operate: 1. On a military technology status will depend, on what Territory the effective power can extend

The states. (It it is possible to express differently: the sizes of the state

Will be caused by that economy on scales, which Provides a present status of technics of manufacture The public blessing "defence".) 2. Infrastructure creation on protection of the property rights Demands delegation of powers from the central power - it To agents on places. But agents, naturally, will behave Opportunistically. Therefore the central power should enter The rules limiting deviations in behaviour of agents from Interests of the centre. These restrictions, of course, cannot be

By which such monitoring system is connected. Hence, Structure and behaviour of bureaucracy (executors of will

To its control.

Economy will induce to introduction in them unequal Legal regimes. (For example, the general property will be To be saved for those resources, for which costs on Specifications of the property rights will be so great that Much more will exceed potential benefits from an establishment Exclusive rights to using these resources.) 4. Aspiration of the higher authority to extraction of the maximum The exclusive rent it will be limited by the potential Competitors as from the outside (when citizens can emigrate in Other country), and from within (when there are possibilities for Revolution fulfilment). Than more well the citizen "substitutes" The present power, the it is less at it than freedom in circulation with Them. Therefore the property rights will be distributed on To groups depending on "contractual force" each of them. The higher authority will agree to allocate the strongest Groups the big property rights to the detriment of reasons Efficiency. 5. Besides, in certain cases the state can To maximise receipts in treasury, establishing Inefficient structure of the property rights. For example, The state will trade in monopolies and Privileges instead of creating conditions for Active competition, because thus it Releases itself from expenses on creation and maintenance of the difficult And expensive system of the taxation. So, some criteria of distribution of the rights face Properties - efficiency, relative contractual Forces, maximisation of the income of treasury: "actually most Obvious lessons of history consist that the political Systems have congenital propensity to establish The inefficient property rights that leads to stagnation And to decline. To such outcome there are two main reasons. First, The income taken by governors can be more at To inefficient structure of the property rights, which, however, Supposes more effective control and consequently more Impressive collection of taxes, than at effective structure The property rights which has high costs on To the control and regulation. Secondly, governors seldom can To dare to establish the effective rights Properties because they would call it discontent Among a considerable part of citizens and, thus, have made The position by less reliable. That is even then, when Governors would wish to establish rules, proceeding from criteria Efficiency, survival reasons will dictate them other Course of actions because effective rules would call Irritation of powerful political groups with Special interests "(51, with. 422). As believes D.Nort, It the conflict between problems of the economic speaks Growth and the majority existing in an economic history Property legal regimes: "Actually structure The property rights which maximises the rent for The governor (or ruling class), is in the conflict with Structure which would provide economic growth "(48, With. 28) 11. Thus both development, and absence of economic growth Has destabilising influence on the state and Dominating system of relations of the property. In the first Case technical progress and expansion of the markets change Developed system of the relative prices that strengthens Pressure of groups which could benefit by these Changes, on the state for the purpose of revision existing Legal regime. These groups direct more resources on Political ends to realise economy

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