On Lawlessness And Economics

Examine the evolution of human society, we can find that behind any kind of system running is a specific rule of game on the allocation of resources to match it. Agitation for 30 years, from traditional society to modern society (Max Weber,1904) difficult transition of the Chinese reform process, so that gradually more and more ordinary people form a consensus:, the fundamental rule of the game behind the modern market economy is based on the rule of law Rules of the game (Qian Yingyi, 2000).At the same time, look at the world today, we can see with regret that particularly in the less developed economies and transition countries, lawlessness exist to varying degrees common. When the government is unwilling or unable to provide adequate through the formal legal system of property rights protection and contract execution time (Avinash Dixit,2002); when the government without any constraints, the State can not avoid opportunism (Yang Xiaokai,2000) so that can not be provided to the market Credible Commitment; when powers refused to truth, lead to crony capitalism (Wu Jing Lian,2004, Xu Xiaonian,2010) become very popular and the rights and dignity of ordinary people (even life) but no relief when deprived of, occurring in the real world how the allocation of resources and rights, how the process, performance how? We have reason to believe that this LLE approach based on lawlessness with the traditional mainstream of neo-classical paradigm (Kuhn,1962) There is fundamental difference, and its resulting "bad market economy" (Yang Xiaokai,1999) system has been long in the world and time eroding the public welfare, sustainable and far-reaching distort the realities of society. Then, in the case of lawlessness, no game rules of the game, how the parties transaction? How can the government be bound to keep its promise and guarantee good governance (World Bank,1997)? Prosperity without freedom (Obama,2010) how to do last? Social transformation is not constitutional where the road leads?For less developed economies and transition countries there is lawlessness reality, this paper analyzes the logical starting point for individual rights, by focusing on individual rights and analytical content, against its relief, in-depth analysis motivation, performance and practical impact of the lawlessness. And on this basis, compared with game systems modeling and analysis of the combination of research methods, a country in transition countries in particular with lawlessness under the conditions of private order, acts of government and its agents, such as economic growth and transformation of the content of constitutional the system resolution. After 30 years of social change, China's reform is moving into deep water. "If you do not hold the future of Chinese society as it ought to, it is possible to reverse the historical trend and the world situation, and once again missed the rise of China's prosperity and opportunity.......At present the most critical and urgent problem is to re-examine the relationship between China's prosperity and harmonious development of the system level problems "(Wu Bolin,2005). The author hope to deep plowing the basic theory of lawlessness and economics(LLE, Dixit,2002; LLSV,1998) so that to make a full system test new interpretation.in China,a country which lack of resources for social change for 30 years.Studies have shown that individual freedom and the protection is the key to cracked miracle of modern economic growth (Angus Maddison,2001). Freedom, prosperity and rule of law, logic has a very high correlation between the resistances: the rule of law is a modern cornerstone of the system of market economy. The rule of law has the strongest explanatory power for the individual freedom.making it the fundamental explanatory variables of the prosperity and the only access path. This is one of the most important historical conclusions, with universal and important implications for testing. Looking at the modern history of social growth, the country that individual freedom and rights are not protected, may appear impressive short-term "growth", but not long-term prosperity and stability, inability to get rid of the traditional society, "sooner prosperity and sooner depression "and the fate of " cycle of history". Lawlessness is the root of poverty.Right is the meta-thesis concept throughout the paper. The prior existence of right creates the intrinsic value of the rule of law in two levels from the form and substance to:Power, Right. Remedy Precedes Rights, no laws, although the law or the natural "draconian" run amok, or even if there is good law but the law long run lead to people without the high cost involved, the existence of these problems makes the people whose rights are infringed upon in the public authority can not get relief, and the lawlessness in the absence of a de facto state, which is where the causes of the lawlessness. With lawlessness, private property rights are insecure, the implementation of the contract can not be effectively protected, and the establishment of private order at the same time, the whole society is in bad governance state, crony capitalism, even the government of Sicily, this is an extreme manifestation of the governance of social evil, which worsened the social welfare and economic growth.Specifically:1.How the paties of the game transaction without rule games?Lacking rule of law, private property rights is in a state of insecurity. Without the rule of law, the property configuration is unknown, the right to relief is not enough, and the contract is enforced. Every moment of private property rights need to face from the others, especially government officials to occupy, steal other predatory behavior.Facing threats, each economic subject or tangible property or try to hide all the non-productive response so that can not engage in normal production activities. The increase in non-productive activities will make any further rent dissipation of rent phenomenon, thereby reducing the financial resources of value; on the other hand, the long-term relationships based on repeated game and industry arbitration become the most common state of the two private transactions in the state of lawlessness. However, with the expansion of trading range, the transactions between acquaintances based on this repeated game performance will gradually decline, compared to it only law on the protection of investors will make efforts to gradually increase the kind of anonymous strangers on transactions carried out fully, in the case of transactions increase the radius of the expansion value of the company.2.How can the government be bound to keep its promise and guarantee good governance?"Grabbing hand" is the researchers (Andrei Shleifer and Robert Vishny,1998) representative government and its behavior under the condition of the image representation. Without the rule of law, making official group has unfettered administrative discretion, with the hands of the public power to improve their personal or family interests as the goal, "thin the world and enrich" the financial resources to looting private. In general, government regulation and private property occupied are two government officials acting in general practice.(1)Income tax at the core of private property occupied. Based on Mancur Olson's theory of roving bandit and sitting bandit, the author ananlysis the taxation of grabbing hand's of lawlessness. The results show that compared with the benevolent-oriented government, based on income maximization considerations, predatory government hopes that each of the lower income members of society to survive online. Taking into account members of the society under Asymmetric Information hiding the reality of personal income, predatory government allow people with higher skills to obtain a higher utility level progressive and let the low-skilled people to maintain a minimum standard of living. Therefore, predatory government and the richest are close friends and most brutal treatment of the poor.(2)Government regulation as the core of industrial policy. The state officials without lawlessness under the group unfettered administrative discretion, by issuing licenses,restrict competitors from entering the way of rules and other industries, artificially create shortages (Janos Kornai,1980), set the rent-seeking space. Studies have shown that countries with lawlessnes, corruption is a universal phenomenon, as opposed to a unified license issued by a single agency, "unilateral administrative monopoly", a variety of complementary products permit are issued by different regulatory units of the "joint administrative monopoly" case of damage to the real economy more:more bribery, yield lower.3. How to continue the prosperity without freedom?Experience has shown that, "the difference of rule of law is the key reason to the level of national economic growth rate and the rule of law reform as a country is the best way from poverty to prosperity "(Barro,2002). In contrast, here is a "Braudel Bell Jar" in less developed countries (Weishen,2006) for the appearances of the rule of law "dual structure" forms:The high operating costs lead to that only a small number of people can enjoy formal legal system, and more marginalization of the poor outside the formal law. Into the "system of become the ordinary people's best choice in lawlessness country, under the conditions, the allocation of talent of ordinary people with lawlessness led to progressive loss of passion for creating wealth redistribution of wealth tend to others, which will make a country's technological innovation slow, real economic growth stagnated. In the "Braudel Bell", the most talented people choose to enter the "system", after, often have their own companies or directs family business. Officials to become entrepreneurs, dignitaries can use their position to avoid the rent-seekers plunder. The cost of the expense of competitors from entering the institutional arrangements improves the officials income, at the same time, will further reduce economic growth. Finance is the core of modern economy.4. Where the road of social transformation without constitutional leads?The transformation of practice in China and Russia as the material, through the model of consititutional law of transition contry construct, research-based perspective of individual rights, systematic analysis of the economies in transition from the "forced sex" to "relationship-based transactions" to "rule type of transaction, "the different evolutionary paths, the system barriers to its operation performance.(1) From the right of compulsory transactions as the core structure to the relationship as the core between the rights of the restructuringIn a particular historical period and the formation of omnipotent government power structure is the logical starting point of transition, based on omnipotent government's forced trade is the fundamental features of the traditional social rights (Wang Xiaowei,2006). The poor want to change, at the beginning of the transition, when the market range is relatively small, the relational structure of rights is a good choice because relational structure on the lower information requirements, and almost no third party (eg court) verification, in particular there is no need to establish as a high fixed cost as the rule of law. At the same time, the relational structure of rights constitutional transition weakened the ability of a country, strengthen the public on the hidden rules of relational capital and beliefs and weaken the vision of the rule of law. This creates a vicious circle:the right to reputation capital in the relational structure is a positive asset, and in purely constitutional system will be of no value. Right from the relational structure to the core of the constitutional rule-transformation will make the rights of bits damage. The incumbent in an organized way skillfully arrange their special interests, and form special interest groups, using political means to resist change, and make the socity lock-in a Crony capitalism state.As the financial resources of natural resources relative to the industry is more likely to be occupied by special interest groups, the richer of the situation of a country's natural, the greater risk of the whole society into the "relationship capitalism", reducing the possibility of constitutional transformation.(2) From the the core of the relationship structure to the core of the constitutional rule structure. With the deepening of the transition, ignoring the constitutional rights of the relational structure of the defect will gradually emerge:the marginal cost of growth will be increasingly high, but with the rule of law established in advance to pay for fixed capital, the rule of the constitutional system as the core gradually reflected economies of scale:the marginal cost of getting lower and lower growth. Thus, at the beginning of the transition, despite the absence of the rule of law rights, but the relational structure can still play a big role, but as the economy continues to grow, the right structure, laid the seeds of destruction of their own:growing need more and more for social transformation rule-based rights structure. Further, according to the the model of consititutional law of transition contry and restructuring practice with China and Russia, it can be drawn, the media play a particular important role in transition:the full disclosure of information by the media deepen the common link between members of society, constraints and sanctions against the predatory behavior of special interest groups of assets, increase the probability of making the constitutional transition. In contrast, under the condition of lawlessness, the countries in transition select not all capital account controls, making the special interest groups in the country full of plundered riches of others, while dirty money can be transferred overseas in order to protect, without having to assume their assets plundered by others. The consequences of this effect can be enhanced powerful incentive to exploit the assets to further reduce the possibility of constitutional transformation."China's most important feature of market-oriented reforms is the lack of constitutional order and rule of law" (Yang Xiaokai,2000). As a rule of law backward-oriented country, China is currently in a "golden" but also the "contradiction highlights" critical period, with China's specific national conditions, the authors propose a phase of imposed institutional change and Social autonomy construction the "two-step" road of gradual transformation of the rule of law.In summary, compared with studies at home and abroad, the paper makes breakthrough in 4 areas:(1)The innovation of researchAs the frontier areas of "law and economics", lawlessness and economics, (LLE) is still in the stage of brewing and pioneering, very few domestic relative research. At the same time, lawlessness, the phenomenon of long-standing in the world has been always eroding public welfare, continued to distort the reality and related research should be strengthened. In view of this, the author bravely combined the academic responsibility, academic studies and daily accumulation of passion to complete the concept of the field from the element, model construction, methodology, basis proposition, examine the research status of the domestic academic community, so system of academic activities to analysis economics of lawlessness are rare.(2) The Innovation of perspectiveThe basis of respecting previous studies, the authors grasp the essence of the rule of law, individual rights analysis to the logical starting point, combining the international mainstream model, less developed economic case, lawless, and systematically expounded with logic from the micro and macro levels and dynamics, lack of lawlessness issues, will overcome the current study separating the micro level and macro level,ignoring the system of dynamic, re-light the rule of law legal missing and so on, and demonstrate a certain degree of inclusiveness innovation of research perspective.(3)The innovation of research methodsThe author combined the game model to comparative institutional analysis (CIA), combined the case study analysis to multi-disciplinary integration, and, use the data of the less developed countries and the transformation countries to do analysis of the modern mainstream model.Such methods adapted the Lawlessness and economics, which is non-traditional and interdisciplinary, that make the problem-solving discussion with the core of a more targeted.(4) The Significance and operational of the conclusionsOn strong reality orientation, in order to demonstrate the cornerstone of individual rights, systematic analysis of this lawlessness issue, which puzzled the less developed countries and transformation countries, to explorations the source of the less developed countries not sustainable long-term prosperity,with highly realistic significance and policy innovation.At the same time, the lack of the relavant knowledge structures of the field of new institutional economics, particularly on the philosophy of law the rights, the experience of mathematical modeling factors will be a continuation of the challenge. Hope in the future course of the study, and continue to move on.