Institutional change, property rights and economic performance in post‐apartheid in South Africa

This article examines redistributive institutional change in South Africa within the theoretical framework provided by North (1979; 1981; 1991) and Eggertsson (1990). By drawing a distinction between the productive potential of an economy and institutionally feasible production possibilities, we can develop an analytical structure for evaluating how alternative systems of property rights can affect productive activity in South Africa. Although this exercise cannot predict actual outcomes in South Africa, it does accord property rights a central role in a specific theory of institutional change, and accordingly may assist in determining how certain forms of institutional change can influence economic performance in a transitional democracy.