ABSTRACT
In the previous chapter, variations in democratic institutional design were explored. The basic difference between the streamlined, rather exclusive British model of democracy and the more cumbersome, yet more inclusive Belgian system were clear from the examples of the Thatcher government’s implementation of the Poll Tax and the process of Belgian cabinet formation. From these examples it is apparent that not all democratic institutions function in similar ways, but the specific factors determining how government functions and the outputs produced by these democratic variations were not addressed. This chapter formulates a theoretical model based on the logic of how decision-making costs, costs of exclusion, and rent-seeking behavior that result from democratic institutional design affect the political and economic outputs of a government.
