When is ordinary law-making tolerated?

• Author: Colombatto, Enrico
• Position: Report

1. From institutions to legal rules

   Institutional analysis has always played a key role in political science and sociology. On the one hand, the historical school of political science has depicted institutions as "procedures, routines, norms and conventions embedded in the organizational structure of the polity", the purpose of which is to define authority and contain conflicts (Hall and Taylor, 1996: 938). In this view, institutional resilience and path-dependence are explained by the actions of the coalitions in power, which rationally try to preserve their prerogatives by making change through ordinary law-making difficult; and also by the presence of cultural elements, as a consequence of which institutions are shaped by the individuals' visions of the world, visions that are in turn affected by the context within which individuals operate and develop their beliefs and opinions, particularly about social goals and about the purpose and scope of government (Steinmo, 1992). On the other hand, sociologists maintain that institutions are ultimately the expression of the community's shared beliefs (Berger and Luckmann, 1966). Thus, sociological institutionalism lays considerable emphasis on people's perception of the existing system of laws, government agencies, and procedures, and analyzes the possible tensions between the moral standards of a society and the formal and informal structures in place within that society.

   Despite their numerous points of contact, however, the historical and the sociological views have originated two different research agendas. Historical scholars have been trying to assess what kind of shocks interrupt a path-dependent process and how the actors involved react to shocks. By contrast, the sociological context has been discussing the notion of legitimacy, which ensures that the individual recognizes an institution as the source of authority and is ready to comply.

   The economics profession has also been aware of the importance of the institutional dimension. As Adam Smith pointed out over two centuries ago, institutions affect individual action, influence cooperation, and are crucial in making the difference between wealth and poverty, growth and stagnation. (1) Not surprisingly, therefore, speculation about the role and purpose of the "humanly devised constraints that shape human interaction" (North 1990: 3) has generated a substantial literature. (2) From the institutional perspective, however, the real challenge is not about searching, designing, and maintaining the best institutions. Rather, it is about explaining why individuals tolerate and possibly support the institutions they have, even when those institutions have failed to deliver the expected results--say in terms of material wealth or income growth. And it is about investigating what moves them to look for substantial institutional change.

   In this paper we abandon the traditional institutional analytical agenda and focus on the last two questions--institutional tolerance and institutional tensions (3)--by framing an interdisciplinary approach that draws from the traditions of political-science, sociology, and economics. (4) In this section we argue that tolerance for the existing order originates from the individual's evaluation of the current system of legal rules, which are judged according to their ability to obtain desirable goals and to respect one's deontological principles. Section 2. explains to which extent people are willing to tolerate deviations from their ideal institutional environments, while section 3. analyzes how different groups of individuals react to the tensions created by excessive deviations (the liberty gaps). Following from this, section 4. puts forward a theory of institutional dynamics based on ideological change, and section 5. concludes.

   1.1 Grand principles and ordinary law-making

   We begin our investigation by distinguishing between 'grand principles' and 'ordinary law-making' (Hayek 1960, Menard 1995). Grand principles are deontological concepts and correspond to shared beliefs about 'fundamental rights' ('justice' and 'fairness'--these terms will be used interchangeably) that may or may not be detailed in formal documents. For example, most individuals within a given community would agree that all the members of the community should be free from need. This principle is often mentioned in official documents (constitutions) as a generic social commitment to solidarity and is a principle to which few citizens would object. Yet, grand principles need to be made operational. To this purpose, ordinary laws are created to fill in the details and transform principles into actions. Thus, ordinary law-making gives substance to the generic notion of poverty relief and enforces redistribution, by imposing suitable taxation, and by establishing and funding agencies responsible for managing poverty-relief programmes, including the distribution of merit goods and outright transfers of money.

   1.2 Tolerance

   Conformity to grand principles defines the effectiveness and legitimacy of ordinary legal rules. (5) Of course, in an ideal world, all ordinary institutions are perfectly congruent with one's sense of justice and thus perfectly legitimate. Yet, reality is never perfect, and individuals are aware that the quest for perfection is vain and understand that tolerance of deviation from an ideal is an ingredient of peaceful cohabitation. For the purpose of this paper, we suggest that this tolerance depends on three variables. The first relates to the individual's perception of the social covenant (social legitimacy), i.e. of the moral standards that one believes are shared by most members of the community. In particular, tolerance is enhanced when the individual perceives that he is part of a cohesive community founded on widely shared principles: in other words the content of the social covenant is relatively well defined. Thus, the individual accepts and respects ordinary laws consistent with the implicit, recognizable covenant characterizing that community, even when these shared standards do not totally coincide with his own.

   The second variable relates to conformity with the rule of law (procedural legitimacy), i.e. to the policymakers' compliance with the prescribed, agreed-upon procedures, independent of the substantive desirability of the law (Mueller and Landsman 2004). This is frequently the case in mature democracies, in which majority or super-majority decision-making procedures prevail and are accepted as legitimate even when consistency with the grand principles appears doubtful. Under these circumstances, the greater is the role of procedural legitimacy, the greater the importance of the electorate as judge of the policy-makers' right to legislate. Once one accepts to play according to given rules, and such rules are applied fairly and consistently, withdrawing from the social contract would be unjustified.

   The third variable is civility, which refers to instinct, education and experience, and which implies consistency with the behaviour that one expects from the other members of his community. Put differently, civility characterizes the individual's perceptions of the interactions among the various members of the community, which can meet the standards of honesty, charity and mutual trust, or which can come closer to the Hobbesian perspective on human nature (hostility, possibly accompanied by violence). A community lacking civility is a community the members of which hardly respect each other, are prone to cheating, are inclined to take advantage of people's weaknesses or carelessness, and frequently decline to offer disinterested help. In other words, a group of people featuring a quasi-Hobbesian state of nature show that they do not believe that they should comply with any code of fair behaviour and that most attempts to cooperate will be stifled. Clearly, lack of civility is different than breaking ordinary laws and thus might not involve sanctions, but loss of reputation. Yet, the lower the degree of civility in a society, the fewer the possibilities for fruitful interaction (not only in material terms) and the more individuals feel uncomfortable about an institutional context that is unable to enhance cooperation with a view to obtaining common goals.

2. Liberties, tolerance and institutional stability

   Following from our emphasis on the role of legitimacy, therefore, in this section we study how humans perceive the institutional context; while we devote sections 3 and 4 to exploring the dynamics of institutions and the mechanics of institutional interaction. Section 5 concludes by taking stock and reassessing the agenda for future research in the realm of institutions.

   2.1 Absolute and civil liberties

   As mentioned earlier, beliefs about justice play a significant role in the development of the individual's social preferences and his assessment of legal order. In particular, we posit that each person elaborates his own notion of justice by following two different criteria. The first criterion is defined by the range of rights that he feels are innate to human nature, that belong to him from birth and upon which nobody should encroach. Blackstone called these rights the individual's set of "absolute liberties". Of course, different individuals may have different opinions about the content of these absolute rights. For example, some people might think that they have no rights other than those produced and assigned by the state. By contrast, others might believe that each individual has a right to physical integrity, freedom of movement and unfettered private property, (6) no matter what ordinary law-making prescribes. (7)

   Yet, there is no guarantee that one's absolute liberties are respected. For example, although most people would agree that cheating and mugging someone are violations of the victim's absolute rights, individuals are still vulnerable to criminal...