Abstract

The United Nations, the WB as well as the IMF speak much of “good governance”, but what is the meaning and reference of this elusive expression? In this paper, I will link it with the concept(s) of rule of law. Rule of law notions are spreading around the globe, being relevant for the transformation of monarchies and one-party states. Thus, world media are now reporting that for instance China’s leadership is seriously debating making state reforms that would be conducive to more of the rule of law in the country. This is not be interpreted as a push towards western democracy. To clarify the relation between rule of law and competitive party democracy, this paper presents an enquiry into rule of law I and rule of law II. This distinction has a long history in political thought and constitutional developments. Data from the encompassing World Bank Governance project is used to validate these concepts referentially.

Highlights

  • The rationale of constitutional rules or institutions is to be found in the restraining of political leaders in socalled principal-agent games that unfold constantly in politics and public administration

  • Let me explain the distinction between two key concepts in good governance: rule of law I and rule of law II, as they refer to good governance, according to the World Bank approach in its Governance project

  • Rule of law (RL) is explicitly separated from voice and accountability (VA), which is defined as follows in the World Bank project thusly: Voice and Accountability (VA) = capturing perceptions of the extent to which a country’s citizens are able to participate in selecting their government, as well as freedom of expression, freedom of association, and a free media (Kaufmann, Kraay, & Mastruzzi, 2010: p. 4)

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Summary

Introduction

The rationale of constitutional rules or institutions is to be found in the restraining of political leaders in socalled principal-agent games that unfold constantly in politics and public administration. Constitutions are best viewed as institutional mechanisms, devised to constrain the behaviour of political elites. These mechanisms are man or woman made devices of rules that are put in place, and hopefully enforced to constrain activities, i.e. institutions. How to cite this paper: Lane, J.-E. The essence of rule of law institutions is to constrain the political agents―politicians at various levels of governments, political parties, rulers, bureaucrats, agencies, etc.―to the advantage of the demos, i.e. the population in a country. Rule of law institutions can restrain political agents from engaging in opportunistic behaviour, like e.g. corruption, favouritism, embezzlement or patronage or the employment of excessive force like torture and sudden disappearances or seizures

Constitutional Principles
Rule of Law I and II
Why Rule of Law I or II
Principal-Agent Interaction in Politics
Agents’ Opportunism
The Production of Value and Its Distribution
Key Forms of Consideration in Political Contracts
On the Risk of Political Monopoly and Looting
On the Risk of Value Dissipation
Variety of Principal-Agent Models in Politics
Good Governance
Conclusion

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