Discussion Paper

No. 2010-6 | February 01, 2010
An Enabling Mechanism for the Creation, Adjustment, and Dissolution of States and Governmental Units

Abstract

The article proposes an enabling mechanism for the creation, adjustment and dissolution of governmental units, giving autonomy to each individual as in a direct democracy. The mechanism is designed such that Pareto optimality is possible, in contrast to earlier models which make various assumptions such as majority voting. Individuals are taken seriously acknowledging that they are best equipped to find their own solutions. The emphasis is on the practical approach of how individuals discover and implement their subjective preferences and how this discovery and implementation process can be facilitated and corresponding costs lowered. Governmental units are subjected to some of the same market forces as business firms. This brings the interaction between governmental units closer to a market structure, and serves to eliminate or reduce many of the coercive elements of government.

Paper submitted to the special issue “Global Governance—Challenges and Proposals for Reform”

JEL Classification

H11 H4 H5

Cite As

Kjell Hausken and John F. Knutsen (2010). An Enabling Mechanism for the Creation, Adjustment, and Dissolution of States and Governmental Units. Economics Discussion Papers, No 2010-6, Kiel Institute for the World Economy. http://www.economics-ejournal.org/economics/discussionpapers/2010-6

Assessment



Comments and Questions


Anonymous - Referee Report 1
March 31, 2010 - 08:49

see attached file


Kjell Hausken - Response to Referee Report 1
April 09, 2010 - 10:07

See attached file


Kjell Hausken - Revised Version
April 09, 2010 - 10:08

See attached file


Anonymous - Referee Report 2
June 07, 2010 - 08:29

See attached file


Kjell Hausken - Reply to Referee Report 2
September 06, 2010 - 10:26

see attached file


Kjell Hausken - Revised Version
September 06, 2010 - 10:38

see attached file