Economic Analysis and the Design of Constitutional Courts

Abstract

Though nominally exercised on behalf of private citizens, constitutional judicial review does perform an insurance function for politicians who expect to lose power in future elections. This paper discusses the various dimensions of institutional design of constitutional courts and argues that the extent and power of judicial review can be expected to increase relative to the degree of political uncertainty at the time of constitutional design. The paper then develops a simple empirical test of this hypothesis using data from Eastern Europe, regressing measures for various aspects of court design on the strength of the largest party in the legislature. The paper shows that the design of constitutional courts reflects the interests of the dominant political parties and that independent and powerful courts are associated with situations of divided or deadlocked politics.