Non-binding formal institutions, collective action and democratization

Abstract: What is the role of formal institutions in settings where they are neither fixed nor binding? I address this question in a formal model where an authoritarian and a pro-democracy group compete for resources and formal institutions affect the collective action of the pro-democracy group. In equilibrium, formal institutions are used strategically: to facilitate collective action when set by the pro-democracy group, and to hinder it when set by the authoritarian group. The likelihood of democratization is a function of how often the pro-democracy group is in power, which depends on its ability to solve its collective action problem. Formal institutions can therefore facilitate or prevent democratization through the effect they have on the pro-democracy group’s collective action. Once established, for democracy to survive the pro-democracy group needs to remain coordinated. I illustrate this argument with reference to Magna Carta in 13th century England and Hugo Chavez’s reforms in Venezuela.