ABSTRACT
Previous chapters have developed a theory of decision costs and rentseeking involved in institutional design. According to this theory, it is expected that more inclusive or consensus oriented systems - those dispersing political power widely - will have lower costs of exclusion than less inclusive, majoritarian systems. In other words, the former include more people in the decision-making process and thereby lower the probability that the costs of collective goods will be shifted onto excluded groups. Moreover, because these systems have lower costs of exclusion (external costs), they should also exhibit lower levels of political violence, fewer workdays lost to strikes, and greater representation of minorities than those systems where power is more concentrated (i.e., majoritarian or ‘strong’ democracies), a finding noted by scholars of consensus democracy.
