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Why Do Institutions Matter? An Audience–Cost Theory of Institutional Commitment
Author(s) -
Lohmann Susanne
Publication year - 2003
Publication title -
governance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.46
H-Index - 76
eISSN - 1468-0491
pISSN - 0952-1895
DOI - 10.1111/1468-0491.t01-1-00209
Subject(s) - commit , credibility , commitment device , institution , flexibility (engineering) , politics , work (physics) , institutional theory , organizational commitment , economics , public relations , political science , microeconomics , law , incentive , management , mechanical engineering , database , computer science , engineering
Institutions constrain political choices and thus commit the future path of policy. Well–designed institutions square the circle of generating commitment that is both credible and flexible. This article develops an audience–cost theory of flexible commitment that addresses some vexing questions. Where does institutional commitment come from? Why is institutional commitment feasible when policy commitment is not? How can an institution achieve credible and flexible commitment without flexibility undermining credibility by opening the back door to defections? How does partial commitment work, or how is it possible for defections to occur in an equilibrium with credible commitment? Why do policy–makers sometimes respect institutional constraints and other times defect on institutional commitments? Why are some defections punished severely, while others are instantly forgiven and forgotten?