The paper outlines why and how political institutions, especially constitutional ones, matter for what decisions are made in the political process and thereby for how the economy functions. The main part contains a survey of empirical studies in this area. Among the things covered: the effects of political and economic freedom, not least property rights, on economic growth; how stricter budgetprocess rules affect tendencies for deficits; the role of electoral systems for shaping policies and affecting fiscal deficits; and the effects of separation of powers – e.g., federalism and referenda – on government size.
Kurrild-Klitgaard, P. & Berggren, N. (2004). ”Economic Consequences of Constitutions: A Theory and Survey.”Journal des Économistes et des Études Humaines, 14(1): 3-42.