De Jure/De Facto Institutions

Abstract

Recent works in Law and Economics distinguish between the so-called de jure and de facto institutions. We define these two types of institutions, as well as indicate their place in the broad institutional system, in particular relative to the formal/ informal and external/internal distinctions applied in (new) institutional economics. We also mention the possible interrelationships between de facto and de jure institutions, linking them to economic outcomes, and provide examples of de jure/de facto analyses in Law and Economics. Finally, we reflect on controversies and lacunas in the literature and present an outlook for future research.

Factors of production, productivity, institutions, and development: Evidence from Brazil

“…9 9 De facto institutions are those observed in actual human interactions, but they do not have to be officially sanctioned. De facto institutions can be formal ( de jure ) or informal, provided they are operative (Lewkowicz & Metelska‐Szaniawska, 2016). …”