When I heard this morning about the Hamas victory in the Palestinian elections, my initial reaction was what I characterize as a new institutional economics idea. One of the reasons why transparent democratic governance institutions lead to social stability (as opposed to stasis) and economic growth is that the combination of the transparency and the democratic process leads to a mechanism for external accountability. We see this in many governance processes, right? When you’re in opposition, you can “get away with” more; once you have formal, official, legal power, that power comes with constraints, both pragmatic (now you have to think about budgets, staffing, etc.) and conceptual/constitutional.
So even though some people are worrying about the peace process and the Palestinian economy in the short run, perhaps holding Hamas to external, enforceable accountability will induce them to change their strategy in a way that is long-run beneficial. After all, don’t we have precedent for that in Ireland?
I’d be really, really keen to hear what Pete Boettke and Frederic Sautet have to say on this topic. Gentlemen?