North, Douglass C.Wallis, John JosephWebb, Steven B.Weingast, Barry R.2012-06-062012-06-062007-09https://hdl.handle.net/10986/7341The upper-income, advanced industrial countries of the world today all have market economies with open competition, competitive multi-party democratic political systems, and a secure government monopoly over violence. Such open access orders, however, are not the only norm and equilibrium type of society. The middle and low-income developing countries today, like all countries before about 1800, can be understood as limited access orders that maintain their equilibrium in a fundamentally different way. In limited access orders, the state does not have a secure monopoly on violence, and society organizes itself to control violence among the elite factions. A common feature of limited access orders is that political elites divide up control of the economy, each getting some share of the rents. Since outbreaks of violence reduce the rents, the elite factions have incentives to be peaceable most of the time. Adequate stability of the rents and thus of the social order requires limiting access and competition-hence a social order with a fundamentally different logic than the open access order. This paper lays out such a framework and explores some of its implications for the problems of development today.CC BY 3.0 IGOACCESS TO THE INTERNETAIDASSETSAUTONOMYBANKSBARRIERBASIC SERVICESBRIBESBUSINESS CORPORATIONSCELL PHONESCELL-PHONECENTRAL BANKSCIVIL SOCIETYCOLLAPSECOLLAPSESCOLLECTIVECOMMUNICATIONS TECHNOLOGYCOMPANYCOMPETITIVE MARKETCONSOLIDATIONCORPORATE INSTITUTIONSCORPORATE ORGANIZATIONCORPORATIONSCORRUPTCRIPPLECRISESCUSTOMDEMOCRACIESDEMOCRACYDEMOCRATIC PROCESSESDIRECT CLAIMDISPUTE RESOLUTIONDIVISION OF LABORDRIVERSECONOMIC ACTIVITIESECONOMIC ACTIVITYECONOMIC COMPETITIONECONOMIC DEVELOPMENTECONOMIC GROWTHECONOMIC THEORYECONOMICSELECTRICITYEX ANTEEXPORT EARNINGSEXTERNALITIESFINANCIAL INSTITUTIONSFREEDOM OF SPEECHFULL POTENTIALGLOBAL ECONOMYGLOBALIZATIONGOVERNMENT REVENUEGOVERNMENT SERVICESGOVERNMENT TRANSPARENCYHARDWAREINCOMEINCORPORATIONINCORPORATION LAWSINDIVIDUALSINNOVATIONINSTITUTIONINSTITUTIONAL STRUCTUREINSTITUTIONAL STRUCTURESINTERNATIONAL CAPITALINTERNATIONAL TRADEINVESTIGATIONJOINT STOCK COMPANIESJOINT VENTUREJUDICIAL SYSTEMSJUDICIARIESJUDICIARYJUSTICEJUSTICESLABOR MARKETSLEADERSHIPLEGAL FRAMEWORKLEGAL PROTECTIONLEGAL PROTECTIONSLEGAL SYSTEMSLICENSESLIMITEDLIMITED ACCESSLIMITED LIABILITYLIMITED LIABILITY COMPANIESLIMITED LIABILITY CORPORATIONSMARKET ECONOMIESMARKET ECONOMYMATERIALMEDIAMENUMENUSMONEY LAUNDERINGMONOPOLYMONOPOLY PROFITSMOTIVATIONMOVEMENTMULTINATIONALNATURAL RESOURCESNETWORKSNEW TECHNOLOGIESNEW TECHNOLOGYOPEN ACCESSOPEN MARKETORGANIZATIONAL STRUCTUREPETTY CORRUPTIONPOLICEPOLITICAL CONTROLPOLITICAL ECONOMYPOLITICAL INSTITUTIONSPOLITICAL INTERESTSPOLITICAL ORGANIZATIONSPOLITICAL PARTIESPOLITICAL PROCESSPOLITICAL SCIENTISTSPOLITICIANSPRIVATE CORPORATIONSPRIVATE NETWORKSPRIVATE SECTORPRIVATE SECTOR DEVELOPMENTPRIVATIZATIONPRODUCTIVITYPRODUCTIVITY GROWTHPROPERTY RIGHTSPUBLIC FUNDSRADIOREGULATORY ENVIRONMENTRENTSRESULTRESULTSRULE OF LAWRULING PARTYSANCTIONSSOCIAL DEVELOPMENTSOCIAL ORGANIZATIONSSOCIAL STRUCTURESSOCIETIESSOCIETYSTOCK CORPORATIONSSTOCKHOLDERSTECHNOLOGY DEVELOPMENTTECHNOLOGY TRANSFERTELEPHONETELEPHONESTELEVISIONTORTSTRIALTYPES OF ORGANIZATIONSUNIONUNIVERSITIESUSERVIOLENCEWEBWESTERN EUROPEWorld Bank10.1596/1813-9450-4359