Abstract
With inefficient bureaucratic institutions, the effects of laws are hard to assess and incompetent politicians may pass laws to build a reputation as skillful reformers. Since too many laws curtail bureaucratic efficiency, this mechanism can generate a steady state with Kafkaesque bureaucracy. Temporary surges in political instability heighten the incentives to overproduce laws and can shift the economy towards the Kafkaesque state. Consistent with the theory, after a surge in political instability in the early 1990s, Italy experienced a significant increase in the amount of poor-quality legislation and a decrease in bureaucratic efficiency.
| Original language | English |
|---|---|
| Pages (from-to) | 2964-3003 |
| Number of pages | 40 |
| Journal | American Economic Review |
| Volume | 111 |
| Issue number | 9 |
| DOIs | |
| Publication status | Published - Sept 2021 |
| Externally published | Yes |
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