Political Determinants of Economic Reforms in the Post-Communist Transition Countries

Staehr, Karsten and Tamazian, Artur and Vadlamannati, Krishna Chaitanya (2009): Political Determinants of Economic Reforms in the Post-Communist Transition Countries.

Abstract

This paper examines how political institutions and electoral outcomes have affected the economic reform process in the post-communist transition countries. Panel data estimations on annual data for 26 transition economies from 1992 to 2006 suggest that the institutional structure of the economy has been of importance, at least for the western-most transition countries. Democratisation and a relatively short exposure to communist rule have been conducive to economic reform, while the timing of elections and whether the government commands a majority in parliament appear to have been unimportant. Governments with right-wing ideology have implemented more market-economic reforms than governments with other ideologies. A high development level but also high inflation have proved conducive to reforms, while unemployment has had the opposite effect.

• Item Type: MPRA Paper
• Language: English
• Keywords: Economic reforms, political economy, political institutions, economic development
• Subjects: P - Economic Systems > P2 - Socialist Systems and Transitional Economies > P21 - Planning, Coordination, and Reform; H - Public Economics > H1 - Structure and Scope of Government > H11 - Structure, Scope, and Performance of Government; P - Economic Systems > P2 - Socialist Systems and Transitional Economies > P26 - Political Economy ; Property Rights

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