The Rise of the Transactional State: How Personal Deals Are Reshaping Democratic Institutions

Abstract

This research work examines the rise of the transactional state as a transformative mode of governance in contemporary democracies, where personal, bilateral deals and quid pro quo arrangements among elites increasingly supplant programmatic policies, impersonal rules, and institutional accountability. Drawing on comparative qualitative analysis, primarily the United States post-2016/2024 alongside insights from Turkey and Peru, it conceptualizes the transactional state as distinct from traditional clientelism by emphasizing its elite-centric nature and zero-sum exchanges that prioritize immediate reciprocity over long-term stability. Key mechanisms include executive personalization through unilateral actions and loyalty appointments, politicization of bureaucracy via transactional federalism and selective resource allocation, and erosion of accountability norms via short-termism, impunity trades, and delegitimization of independent bodies. Short-term effects yield elite coalition stability and gridlock avoidance, but long-term consequences encompass weakened public goods delivery, heightened corruption perceptions, declining trust, and democratic entropy as informality replaces formal rules. Comparative insights reveal variations between consolidated and newer democracies, contrasting transactional periods with prior programmatic eras, while highlighting counter-trends through judicial, civil society, and institutional resistance. The study argues that transactionalism drives incremental hybridization and backsliding, urging safeguards to preserve democratic resilience amid global autocratization pressures.

Keywords: Transactional State, Democratic Erosion, Executive Personalization, Elite Bargaining, Institutional Reshaping, Democratic Entropy