Practice running ahead of theory? Political economy and the economic lessons of UK devolution

Abstract

Advocates of political decentralisation make much of its supposed ‘economic dividends’. Critics of this argument, while acknowledging the possible benefits, suggest that the specific ‘institutional geography’ under which devolution operates is crucial. In short, the Institutionalist critique is that economic outcomes are contingent on the way devolved institutions are designed. The institutional geography of contemporary UK devolution, as well as the historical case of Northern Irish devolution (1920–1972), is analysed in this article. Contemporary and historical evidence, as well as theoretical material presented, provides further support for the hypothesis that institutional structures are crucial.