Transplantation of economic institutions: An extended (post-institutional) theory

Most of research on institutional transplantation is based on a set of general methodological principles and theoretical positions, which in total might be termed the “classical theory”. Despite its persuasiveness and wide currency (including outside the economic discourse), the classical theory of institutional transplantation has many built-in methodological limitations. It has a pronouncedly one-sided character, is based on reductionist approaches, and has problems with a systemic explanation of transplant processes in the modern economy. The article presents an interdisciplinary research program for the extended theory of institutional transplantation. The extended theory proposes to pay special attention to bottomup transplants, as well as the role of institution-based communities — heterogeneous networks of internal and external actors of transplanted institutions. Adaptation of a transplanted institution to the new environment is viewed more as an active transformation of the environment by actors (institutional niche construction). The deviations from foreign prototypes arising in transplanted institutions are interpreted as adaptive refunctionalizations rather than transplant failures. Special emphasis is placed on the interactive communication field in which transplanted institutions develop. As a result of transplantation, it is proposed to consider not the dichotomy of successful adaptation and rejection of a new institution, but the emergence of institutional assemblage — a complex system of borrowed and local institutions based on irreducible institutional logics.

Grand Duchy of Lithuania: institutional transplantation experience

This paper analyzes the evolution of the institutional matrix of the GDL and establishes two stages in it. The first (pre­federative) is characterized by institutional diffusion, from the Kingdom of Poland in the first place, whereas the second is linked with the formation of the Commonwealth of Poland and Lithuania. It is shown that, as the formed federation united societies with distinct types of dominating institutions, institutional transplantation occurred from the more economically developed country to the other. Such integration leads not only to positive implications but also to the mutation of the transplanted institutions (strengthening of serfdom during the transition to the more progressive folwark agriculture). Transfer of the Western European system of fideicommissum inheritance turned out to be an institutional pitfall since the indivisible manors – ordynacii – presented a case of a state within a state, with their owners relying on the redistributive institutions at the microlevel (within their estates) and pursuing the market institutions at the macrolevel (within the country as a whole) in order to cement their economic position.Peculiarities of the political sphere conditioned the transformation of the socio­cultural subsystem of the GDL’s institutional matrix. Roman Catholicism expanded rapidly, undermining the religious tolerance that the Grand Duchy had hitherto been known for. The elements of subsidiary ideology, coming from Poland, were understood as giving exceptional rights only to the szlachta stratum; acquisition of the golden liberties was equated with conversion to Catholicism and the use of the Polish language.The consequences of these policies were the following: Polonization and mass conversion to Catholicism among the propertied classes; widespread resentment among the worse­off, morphing into popular uprisings in the XVII century; alignment of property, confession, and language groups in the society, which moved the social inequality issue into the ethnic dimension and contributed to interethnic strife in the lands of the former GDL in the centuries to come.The absence of efficient governmental management of institutional transplantation caused an institutional crisis, which, with the political elites being disunited, was the reason for the entire social system to disintegrate.

The Autocratic Legacy of Early Statehood

This article documents that precolonial state development was an impediment to the development of democracy outside Europe, because indigenous state institutions constrained the European colonial endeavor and limited the diffusion of European institutions and ideas. Some countries were strong enough to resist colonization; others had enough state infrastructure that the colonizers would rule through existing institutions. Neither group therefore experienced institutional transplantation or European settlement. Less developed states, in contrast, were easier to colonize and were often colonized with institutional transplantation and an influx of settlers carrying ideals of parliamentarism. Using OLS and IV estimation, I present statistical evidence of an autocratic legacy of early statehood and document the proposed causal channel for a large sample of non-European countries. The conclusion is robust to different samples, different democracy indices, an array of exogenous controls, and several alternative theories of the causes and correlates of democracy.

Are institutional transplants viable? An examination in light of the proposals by Jeremy Bentham

The problem of institutional transplantation is an important issue. In Jeremy Bentham's work, we find practical as well as theoretical proposals regarding this problem. Here, we view his work as an invitation to reflect on the overall nature of the question of institutional design and transplantation. The transfer of institutions requires knowledge of ‘place and time’ that will allow for an accommodation of the transferred institutions to their new soil. However, an awareness of this type of knowledge and thus relying on its actually being available is not viable from a practical point of view. This is due to the fact that the core of informal institutions is tacit, which imposes a fundamental constraint on the process of institutional transplantation; informal norms must co-exist with formal rules, and such merging requires some accommodation of both types of rules.