Economic effects of (non-)compliance with constitutions

Abstract

Constitutional non-compliance, understood as non-congruence between provisions written in countries’ constitutions and the behavior of their governments, has recently become the focus of economic analysis. While other studies concentrate on the reasons behind this phenomenon, we are interested in its economic effects. We argue that non-compliance with constitutions is associated with lower GDP per capita and test our hypothesis empirically for more than 150 countries in the period 1960–2019 using the new Comparative Constitutional Compliance Database and a dynamic panel strategy. Our study confirms adverse economic effects of constitutional violations and this, in particular, in the area of property rights protection and the rule of law. In addition, we indicate groups of countries, where (non-)compliance with constitutions is of particular relevance, as well as identify the mechanisms behind these effects. Our findings contribute to several strands of literature at the nexus of constitutional political economy and development economics.