Economics is a central science to the understanding of regulation. Regulatory economics focuses on economic concepts that are relevant in regulatory contexts. Chapter 1 introduces key concepts of economics and regulatory economics, referring to a branch of social sciences concerned with how society chooses to employ its scarce resources to produce goods and services. This chapter offers a brief discussion of economic concepts that have shaped regulation (e.g., monopoly, market failures). It also discusses behavioral economics, the commons, and principal-agent theory.

In this chapter economic aspects of constitutions are explored. Basically there are three. Constitutions, firstly, act as a condition for markets and the overall economy: they are, most of the time, criticial preconditions for economic development by the - predictable - laws they generate and the protection they offer for property and capital). Secondly constitutions act as a factor in markets and the economy. They, for instance, lower transaction costs. And. thirdly, constitutions act as a catalyst in economic relations, e.g. by boosting mutual trust.

Agape is just as foundational as justice for the existence, proper functioning, and sustainability of socioeconomic life. In the same way that justice has a crucial function in the marketplace, agape also has its unique and vital role to play. The marketplace requires the tandem of agape and justice working hand in hand if it is to exist at all, much less thrive. We see this in critical areas that shape the character and quality of socioeconomic life: institutional preconditions; value formation and development of customs, law, and usage; triage and pursuit of economic goals; and frictional and transaction costs.

Transaction costs are the costs of strengthening a given distribution of economic property rights. When these costs are positive, economic property rights are never perfect and the Coase Theorem does not hold. Furthermore, different distributions of these property rights lead to different levels of joint wealth.

Populism is a political strategy that relies on the use of a personalistic political organization and mass communication to mobilize support in the quest for power; it will be most successful when it is more cost-effective than the alternatives of programmatic political party building or the distribution of patronage. The costs involved in this trade-off come in two forms: direct costs and indirect (or transaction) costs. In politics, very often transaction costs – search, bargaining, and enforcement costs – are the higher ones. Populists lower the costs of mobilizing support by communicating directly with voters instead of working through intermediaries such as party professionals or political brokers. The populist strategy will be most effective when two conditions are met. First, potential voters or supporters must be available for direct mobilization. This means that they must be relatively free of existing party attachments. Second, the opposition should be divided. Most populists win with the backing of a mere plurality rather than a majority. The more the opposition is split between multiple contenders, the more economically viable is the populist strategy.

The social foundations of the environmental strategy framework lie in Coaisan exchanges between companies and their stakeholders to reduce companies’ environmental impacts. A company’s environmental impacts are negative externalities in that they have consequences borne by those who did not choose to incur them. A Coasian exchange occurs when stakeholders compensate companies to reduce their production of negative externalities, resulting in outcomes that benefits the company and its stakeholders. The obstacles to Coasian exchanges are (1) search and screening costs to identify environmental improvements and stakeholders; (2) bargaining and transfer costs to negotiate terms and exchange resources; and (3) monitoring and enforcement costs to ensure both sides of the exchange uphold their obligations in the exchange. The goal of environmental strategy is to identify and mitigate these obstacles so that companies can implement environmental improvements that create value across the triple bottom line.

We discuss vertical mergers, which occur when two firms at different levels of the supply chain consolidate to become one firm. Vertical mergers can provide procompetitive benefits when they decrease transaction costs, such as those incurred in market exchange, and eliminate double marginalization. These mergers, however, may increase a firm’s market power, which could lead to raising rivals’ costs or market foreclosure. In this chapter, we provide a comprehensive theory of vertical integration. We also discuss mergers that involve suppliers of complementary goods.

The book opens with a discussion of the theoretical importance of the rise of social media, focusing on the way that decreases in transaction costs of communication change the potential for populations to solve their collective action problem. In addition, it highlights the historical importance of social media as a data source, with scholars having access to the communications of the public en masse for the first time. The cheapness and accessibility of this data democratizes data collection efforts, which changes the nature of research questions that can be asked by scholars.

This chapter reviews the evidence from the Greek world for tribute and taxation. It begins with some comparative considerations about tributary regimes and the impact of Achaemenid imperialism on the fiscal development of the Greek city-states, including the Delian League and the Hellenistic kingdoms. The transition from tribute to taxation is cast as a significant indicator of state formation. A fundamental theme in ancient Greek taxation is the relationship between coercion and consent, especially how political institutions facilitate the sharing of communal burdens by the rich. Extraordinary levies on property and persons were a common feature of city-states, which Macedon and the Hellenistic kingdoms also adopted. Finally, the chapter treats indirect taxes, which are thought to provide a much larger and more regular portion of state revenue in the Greek world.

Over the last twenty years, New Institutional Economics (NIE) has been a highly influential model in the study of the Greek and Roman economy. Although both its assumptions and methods are controversial, NIE approaches have changed the agenda of ancient economic history. The overall goal of neo-institutional economic history is to explain economic development, and notably growth, in line with a much-quoted phrase by the Nobel-prize winning economist Douglass North, that it is the task of economic history to explain the structure and performance of economies through time. NIE approaches and methods have therefore stimulated quite specific research directions in ancient economic history. This chapter suggests that NIE offers a fruitful conceptual matrix for asking new questions – with or without the answers necessarily staying within the NIE model. By contrast, the aim of the NIE method to predict and quantify outcomes, and the broader implications of the approach, are far more difficult to accept and defend. Particularly problematic is its commitment to certain kinds of growth as the desirable outcome of economic development, together with the assumption of the universal benefits of that growth, with its end point and golden standard explicitly or implicitly based on successful economies of the modern West.

The market in ancient Greece should be understood as a specific institutional construct, that of the city-state, which allowed its citizens to exercise private property rights guaranteed by law. By extension, free foreigners were also acknowledged these rights, which however extended to the private ownership of human beings (slavery). The city-state also created the conditions for an unusually high division of labour. Each city was a market space of its own, with its own rules and logic, which could include the control over sales margins and even sometimes the establishment of maximum prices for some perishable fresh goods. The network of hundreds of Greek city-states also created the conditions for the development of an original form of international market.

Although significant progress has been made in dealing with ancient economies through the establishing of new methodological approaches (like the New Institutional Economics), old-school Political Economy still plays an important role. It endeavours among other things to describe and evaluate the causes which lead to economic growth, thereby including factors which cannot be subsumed under the category of ‘institutions’ (exclusively focused on by the NIE) like demography or climate. Recently, this traditional approach has been intensively adopted to explain and measure the growth of ancient Greek economies between the ninth and fourth centuries, today viewed as an established fact in contrast to the older consensus, which was characterised by scepticism regarding the capability of ancient societies to generate sustainable growth. This chapter presents the most important factors that were (supposedly) conducive to growth and describes and their mutual interplay and interferences. In a further section, some methodological and empirical problems of the way 'ancient growth' is quantified in contemporary research are discussed. In a final section, some thoughts are offered on geo-economic factors, assumed by the author to have had a decisive impact in bringing about 'growth' or concentrations of wealth in some areas and milieus.

This chapter introduces a new framework that analyzes the role of timing and temporality in international institutions and world politics. It describes the temporal coordination dilemmas facing international actors. The chapter details the challenges posed by gradually accumulating incentives to alter international institutions and by the large number of actors that must be brought into the picture if institutional change efforts are to succeed. In realizing major change, a large array of moving pieces must be synchronized at one point in time, entailing considerable complexity and transaction costs. Indeed, the political and analytical investments – both international and domestic in nature – involved in recasting institutions are very substantial. Actors’ willingness to incur a sharp increase in transaction costs depends on their expectations that others will engage in a parallel effort. Thus, even as incentives to alter institutions mount, the inertial drift of institutional life persists until actors are able to reach a temporal convergence of expectations. At that time, actors make substantial investments in change processes and alter fundamentally their bargaining behavior.