Constitutions and Economic Policy

t the rare moments in history when a nation debates constitutional reform, the key issues often concern how the reforms might affect economic policy and economic performance. For example, Italy abandoned a system of pure proportional representation, where legislators were elected according to the proportions of the popular national vote received by their parties, and moved toward including ingredients of plurality rule, where legislators are elected in each district according to who receives the highest number of votes. Key Italian political leaders are now considering proposals to introduce elements of presidentialism, where the head of government is elected by direct popular vote, rather than the current parliamentary regime. A common argument in Italy was that the electoral reform would help stifle political corruption and reduce the propensity of Italian governments to run budget deficits. In the 1990s, constitutional reforms have been debated and implemented in a number of other countries, too. For instance, New Zealand moved away from a pure system of plurality rule in single-member districts to a system mixing elements of proportional representation. Japan also renounced its special form of plurality rule (the so-called single nontransferable vote) in favor of a system that mixes elements of proportional and plurality representation. Similar proposals have been debated in the United Kingdom. In Latin America, questions have been raised as to whether the poor and volatile economic performance of many countries can be traced to their presidential form of government.