While there is a growing literature on state formation and the rise of state capacity over time, this literature typically deals with differences between countries, neglecting the fact that state formation also occurs differentially within a country over time. This article examines legacies of state formation spatially, by looking at variation within “frontier” states—countries that in recent centuries have extended rule over new territories adjacent to their core regions. Frontier zones are found to have ongoing lower levels of public order and deficient public goods provision. Several theories are examined to explain this discrepancy, including internal resettlement, costs of monitoring and enforcement, and the relationship between settlers and the indigenous population. It is argued that the formation of strong social institutions among settlers leads to resistance to attempts to impose governance over frontier regions, and to “select for” lower fiscal capacity and lower provision of public goods.
The paper considers monitoring of environmental change as the central element of environmental regulation. Monitoring, as each kind of principal-agent relations, easily gives rise to corruptive behavior. In the paper we analyze economic models of environmental monitoring with high costs, incomplete information and corruption. These models should be the elements of environmental economics and are needed to create an effective system of nature protection measures.