A Supply and Demand approach to the Institutional Performance of Haiti

Abstract

The recent political crisis in Haiti, the poorest country in the western hemisphere, has again called the attention of the international community. This paper tries to describe the development path of Haiti, and advances some hypotheses explaining its reasons. Since the traditional explanations proposed by Marxists and neoclassical economists seem to be insufficient, this paper offers an Institutional approach to improve our understanding of the causes of poverty in Haiti and to visualize policy solutions. The claim is that the supply and demand of enforceable institutions had been low, due to suboptimal strategies played by the dictators and the public/army. The suboptimal equilibrium has been predate/disobey the law, and predate/organize a cue. This hypothesis reinforces Douglass North's idea of 'path dependence', and suggests that more education and/or the reduction of the scope of government could be longterm solutions for the repeated political economy problems that Haiti has experienced during the past 200 years.