With the sales of offices, spoils system and nepotism, it is hardly surprising that professionalism was conspicuously lacking in the bureaucracies of most NDCs at least until the late nineteenth century. The Jacksonians in the USA had a contempt for expert knowledge, and were against the professionalization of the bureaucracy on the grounds that the largest possible number of citizens should be able to participate in the act of government. Even after the 1883 Pendleton Act, which set up the Civil Service Commission to administer competitive recruitment to the federal bureaucracy, only about 10 per cent of civil service jobs were subject to competitive recruitment. Italian bureaucrats in the late nineteenth century had ‘no legal, or even conventional, guarantees on tenure, dismissals, pension, etc., and no recourse to the court’. Until the early twentieth century, civil service careers in Spain were heavily determined by what was known as padrinazgo (godfathership). Even in Belgium, which in the nineteenth century was the second most industrialised country after Britain, the civil service was not fully professionalised until 1933.[38]
It was only through a long-drawn-out process of reform that the bureaucracies in the .NDCs were able to be modernized. The pioneer in this regard was Prussia. An extensive bureaucratic reform was implemented by Frederick William I from 1713, the year of his accession to the throne. The key measures included: the centralization of authorities scattered over two dozen separate territorial entities (many of them not even physically contiguous) and overlapping departments; the transformation of the status of the bureaucrats from private servants of the royal family into servants of the state; regular payments in cash (rather than in kind as before) of adequate salaries; and the introduction of a strict supervision system.[39] Thanks to these measures and to the additional measures introduced by his son, Frederick the Great (1740-86), by the early nineteenth century Prussia could be said to have installed the key elements of a modern (Weberian) bureaucracy – an entrance examination, a hierarchical organization, pension systems, a disciplinary procedure and security of tenure. Other German states such as Bavaria, Baden and Hesse also made important progress along this path during the early nineteenth century.[40]
In Britain, sinecures were eliminated through a series of reforms between 1780 and 1834. Bureaucratic remuneration was changed in the first half of the nineteenth century from a fee-based to a salary system. It was also only around this time that the status of government ministries in Britain was changed from private establishments to government ministries in the modern sense. It was only after 1860 that the British Civil Service was substantially modernized.[41] The USA made some important progress with the professionalization of the bureaucracy in the last two decades of the nineteenth century, as the proportion of federal government jobs subject to competitive recruitment rose from 10 per cent in 1883, when the Pendleton Act was introduced, to nearly 50 per cent by 1897.[42]
In the contemporary discourse on ‘good governance’, there is a strong emphasis on a politically independent judiciary administering ‘rule of law’.[43] However, we have to be somewhat careful in embracing this ‘independent judiciary’ rhetoric.
It could be argued that a judiciary with a very high degree of political independence (for example, the German or Japanese judiciary) is not necessarily desirable, as it lacks democratic accountability. This is why some countries elect some of their judicial officials – the best-known examples being the USA today, and the UK in the nineteenth century.[44] In the UK, the boundary between the judiciary and the legislature is also blurred, since its highest judges sit in the House of Lords; however, few people would argue that this is a major problem.
Given this, we need to understand the quality of the judiciary not simply in terms of its political independence, but in a number of dimensions – the professionalism of the judicial officials, the quality of their judgments (not simply from a narrow ‘rule of law’ point of view, but also from a broader societal point of view) and the cost of administering the system.
Like their counterparts in modern-day developing countries, the judiciary in many NDCs suffered from excessive political influence and corruption in appointments (or, where applicable, elections) up to, and often beyond, the late nineteenth century. It was also frequently filled exclusively with men from a narrow, privileged social background with little, if any, training in law, with the result that justice was often dispensed in biased and unprofessional ways.
In the UK, even the anti-corruption laws of 1853-4 and 1883 (see above) did not affect the election of coroners, which was subject to widespread corruption and party political manoeuvring. Elections for county coroners were only abolished in 1888, and it was not until 1926 that professional qualifications for county coroners became compulsory.[45]
During the late nineteenth century Germany made impressive progress towards ‘rule of law’ and by the end of the century had gained a largely independent judiciary. However, there was still a lack of equality before the law, with military and middle-class crimes less diligently brought to court and less severely punished. This problem of ‘class justice’ dogged other NDCs just as badly at this time – including the UK, the USA and France.[46] In Italy, at least until the late nineteenth century, judges did not usually have a background in law and ‘could not protect themselves, let alone anyone else, against political abuses’.[47]
3.2.3. Property rights regimes
In the ‘good governance’ discourse, the ‘quality’ of property rights regimes is regarded as crucial, as it is believed to be a key determinant of investment incentives and thus of wealth creation. However, measuring the ‘quality’ of a property rights regime is not easy, because it has numerous components – contract law, company law, bankruptcy law, inheritance law, tax law and laws regulating land use (e.g., urban zoning laws, environmental standards, and fire safety regulations), to name just a few.
In many empirical studies, this ‘aggregation problem’ is avoided by asking survey respondents to give a numerical value to the overall quality of the property rights institutions (e.g., ‘security of contract and property rights’ or ‘enforcement of contracts or property rights’).[48] However, even this highly inadequate ‘solution’ to the problem is not available for the historical comparison that we are attempting in this chapter.
Therefore, in contrast to other aspects of institutional development discussed in this chapter that are more ‘measurable’ (e.g., democracy measured by the existence of universal suffrage, development of financial institutions measured by, among other things, the existence of the central bank), it is impossible to provide a generalized comparison of the quality of property rights regimes through history and across countries.
One aspect of the property rights system that does easily lend itself to this kind of analysis is that of intellectual property rights, which are defined by a small number of clearly identifiable laws (e.g., patent law, and to a lesser extent, copyright law and trademark law). In this section we therefore provide a detailed empirical analysis of the evolution of intellectual property rights regimes in the NDCs. First, however, a few general theoretical comments on the role of property rights in economic development (with some historical references) are in order.
38
Garraty and Carnes 2000, pp. 254, 583 (for USA); Clark 1996, p. 55 (for Italy); Palacio 1988, p. 496 (for Spain); Baudhuin 1946, pp. 203-4 (for Belgium).
40
On the characteristics of the modern ‘Weberian’ bureaucracy in the context of . today’s developing countries, see Rauch and Evans 2000; Anderson and Anderson 1978; see also Blackbourn 1997, pp. 76-7, 82-4.