Law, Economics, and History: Endogenous Institutional Change and Legal Innovation

Understanding the origins of formal and informal institutions of cooperation and regulation and their long-lasting impact on market exchange and technological investment is one of the most pressing questions in law, economics and history. Accordingly, despite the different angles considered by different disciplines, the notion that institutions emerge endogenously in the face of both welfare-enhancing and rentseeking motives has recently come to be an accepted paradigm. Yet, despite this convergence, an even more vigorous effort in inquiring the determinants and the effects of institutional change is needed in order to guide legal and institutional reforms. The aim of this chapter is to substantiate this desideratum and, at the same time, to provide a new interdisciplinary research agenda.