The Clan and the Corporation: Sustaining Cooperation in China and Europe
61 Pages Posted: 12 Mar 2015
There are 2 versions of this paper
The Clan and the Corporation: Sustaining Cooperation in China and Europe
Date Written: February 28, 2015
Abstract
Over the last millennium, the clan and the corporation have been the loci of cooperation in China and Europe respectively. This paper examines - analytically and historically - the cultural and institutional co-evolution that led to this bifurcation. We highlight that groups with which individuals identify are basic units of cooperation. Such loyalty groups influence institutional development because intra-group moral commitment reduces enforcement cost implying a comparative advantage in pursuing collective actions. Loyalty groups perpetuate due to positive feedbacks between morality, institutions, and the implied pattern of cooperation.
JEL Classification: N000, A100
Suggested Citation: Suggested Citation