Theories which explain the origins of institutions as the product of struggles for distributive advantage provide only a general framework with no conceptualization of the bargaining process and few applications to empirical cases. We address both problems and extend the distributive theory of institutional origins by drawing on a unique set of data to examine the creation of the Hungarian electoral law of 1989. Arguing that outcomes are shaped by four mechanisms arising from bargaining—time preferences, the credibility of threats and promises, mimicked fairness, and symmetrical division—we develop observable implications of these mechanisms and test them empirically by analyzing the bargaining which produced the multiple rules of Hungary's complex electoral system. Not only does the Hungarian case confirm the bargaining mechanism theory of institutional origins, but the theory also explains many curious features of the Hungarian electoral institutions, including its surprising combination of extraordinary complexity and unusual stability.
Working Paper 97–05, Weatherhead Center for International Affairs, Harvard University, May 1997.