Coordination or Coercion in the Provision of Goods by the State
This dissertation contributes to our
understanding of the mechanisms behind the development of
the state's ability to coercively enforce. In so doing, the
dissertation sheds light on the implications that different
ways of organizing and coordinating human interactions have
on political and economic development. The analyses are
based on insights provided by the colonial history of
Mexico. Chapter 1 studies the mechanisms behind the creation
of state administrations backed by coercive enforcement to
collect fiscal revenue. The analysis suggests that the
enforcement mechanism used by the state to collect revenue
is endogenous to the excludable nature of the goods provided
by the state. Chapter 2 provides an operational definition
of legitimacy and outlines the conditions under which, so
defined, legitimacy can serve as a mechanism for rulers to
concentrate coercive power. In a dynamic common agency model
with rational agents and perfect information, where nobody
can sign binding contracts, the analysis shows that players
voluntarily give up their coercive power under some
circumstances.