Polterovich, Victor and Popov, Vladimir (2007): Демократизация и экономический рост. Published in: Obschestvennye nauki i sovremennost' No. 2 (2007): pp. 13-27.
Download (866kB) | Preview
There are two innovations in the paper as compared to the previous literature on democracy and growth. First, we consider not only the level of democracy, but also changes in this level in the 1970s-1990s as measured by increments of Freedom House political rights indices. Second, the distinction is made between democracy and law and order (order based on legal rules); the latter is measured by the rule of law, investors' risk and corruption indices. We discuss two interconnected threshold hypotheses: (1) in countries where law and order is strong enough, democratization stimulates economic growth, whereas in countries with poor law and order democratization undermines growth; (2) if democratization occurs under the conditions of poor law and order (so that illiberal democracy emerges), then shadow economy expands, quality of governance worsens, and macroeconomic policy becomes less prudent.
We adduce a number of stylized facts to support our hypotheses. However our econometric findings are mixed: we report results that support the hypotheses as well as regressions that contradict them.
|Item Type:||MPRA Paper|
|Original Title:||Демократизация и экономический рост|
|English Title:||Democratization and Economic Growth|
|Keywords:||Economic growth; democracy; rule of law|
|Subjects:||P - Economic Systems > P1 - Capitalist Systems > P16 - Political Economy|
|Depositing User:||Victor Polterovich|
|Date Deposited:||01 Jun 2010 06:26|
|Last Modified:||21 Nov 2016 02:07|
Афонцев, С. (1999). Экономическая трансформация в зеркале политико-экономического анализа. – Россия XXI, 1999, No. 3, с. 49-83.
Полтерович, В., В. Попов. Стадии развития и экономический рост. – Вопросы экономики, № 7, 8, 2006г.
Попов В.В. (1998). Экономическая динамика при переходе к рынку: влияние исходных условий и экономической политики. – Вопросы экономики, №.7, 1998г., с. 42-64. Сильные институты важнее скорости реформ. – Вопросы экономики, №.8, 1998г, с. 56-70.
Aaron, J. (2000). Growth and Institutions: A Review of the Evidence. The World Bank Research Observer, v.15, No.1, 99-135.
Acemoglu, A., Johnson, S., and J.Robinson. (2004). Institutions as the fundamental cause of long-run growth. NBER Working paper series, Working Paper 10481.
Acemoglu, A., Johnson, S., Robinson, J., and P. Yared (2005). Income and Democracy. MIT, Working paper 05-05, February, 35 pp.
Akhmedov, A., and E. Zhuravskaya (2004). Opportunistic Political Cycles: Test in a Young Democracy Setting. - Quarterly Journal of Economics, November 2004, 1301- 1338.
Alesina, A. and Rodrik, D. (1994), Distributive Politics and Economic Growth. – Quarterly Journal of Economics, 1994, May, Vol. 109, No.2, pp. 465-90.
Barro (1996). Democracy and Growth. Journal of Economic Growth, Vol.1, 3-27.
Barro (1999). Determinants of Democracy. Journal of Political Economy, 1999, Vol. 107, No.6, 158-183.
Barro R. (2000). Rule of Law, Democracy, and Economic Performance. Index of Economic Freedom, Ch.2, 31-49.
Brumberg, D. (2003). Liberalization Versus Democracy. Understanding Arab Political Reform. Carnegie Endowment for International Peace, Working paper No. 37.
Campos, N. (1999). “Back to the Future: The Growth Prospects of Transition Economies Reconsidered”. William Davidson Institute Working Paper No. 229, Ann Arbor, April 1999.
Carothers, Thomas (2002). The End of the Transition Paradigm. – Journal of Democracy, Jan. 2002, pp.5-21.
Chang, H.-J. (2002). Kicking Away the Ladder. Cambridge University Press.
Cheung, S. (1998). The Curse of Democracy as an Instrument of Reform in Collapsed Communist Societies”, Contemporary Economic Policy, Vol.16, No.2, April 1998 pp.247-249.
Dethier, Jean-Jacques, Ghanem, Hafez, Zoli, Edda. Does Democracy Facilitate the Economic Transition? World Bank, 1999.
Chua, Amy (2002). World on Fire: How Exporting Free Market Democracy Breeds Ethnic Hatred and Global Instability. New York : Doubleday, 2002.
Clague, Ch., Keefer, Ph., Knack, St., and M. Olson (1996). Property and Contract Rights in Autocracies and Democracies. Journal of Economic Growth, Vol.1, (June), 243-276.
Diamond, Larry (1997a). Is the Third Wave of Democratization Over? An Empirical Assessment, Helen Kellogg Institute for International Studies Working Paper no. 236 (University of Notre Dame, March).
Diamond, Larry (1997b). Is the Third Wave of Democratization Over? The Imperative of Consolidation. Working Paper #237 March 1997
Dornbush, Rudiger and Edwards, Sebastian (1989). The Economic Populism Paradigm. NBER Working Paper 2986, Cambridge, Mass., 1989.
Ellman, Michael (2000). The 1947 Soviet Famine and the Entitlement Approach to Famines. – Cambridge Journal of Economics, 2000, Vol. 24, pp. 603-30.
Fernandez, Raquel, and Rodrik, Dani (1991). Resistance to Reform: Status Quo Bias in the Presence of Individual Specific Uncertainty. – American Economic Review, 1991, Vol. 81 (5), 1146-1155.
Fidrmuc, Jan (1998). Political Support for Reforms: Economics of Voting in Transition Countries. – European Economic Review, 44 (8), 2000, pp. 1491-1513.
Fidrmuc, Jan (2002). Economic Reform, Democracy and Growth during Post-communist Transition. CEPR Discussion Paper No. 2759, 2002.
Friedman, Eric J., Johnson, Simon, Kaufmann, Daniel, Zoido-Lobaton, Pablo (1999). Dodging the Grabbing Hand: The Determinants of Unofficial Activity in 69 Countries. – Fifth Nobel Symposium in Economics. Stockholm, September 10-12, 1999
Frye, T. & Shleifer, A. (May 1997). The Invisible Hand and The Grabbing Hand, American Economic Review, pp. 354-358.
Gastil , R. D. ( 1989). Freedom in the World: political Rights and Civil liberties, 1988-89. New York, Freedom House.
Gradstein, Mark and B. Milanovic (2004). Does Liberté=Egalité? A Survey of the Empirical Evidence on the Links Between Political Democracy and Income Inequality. Final version published in Journal of Economic Surveys, vol. 18 No. 4, pp. 515-537, September 2004.
Hellman, Joel, Jones, Geraint, and Kaufmann, Daniel (2000). How Profitable Is Buying the State Officials in Transition Economies? - Transition. The Newsletter About Reforming Economies, April 2000, p.8-11.
Holmes, S. (1997). What Russia Teaches Us Now. - The American Prospect, July-August, 1997, p. 30-39.
Intriligator, M.D. (1998). Democracy in Reforming Collapsed Communist Economies: Blessing or Curse? – Contemporary Economic Policy Vol.16, No.2, April 1998, pp.241-246.
Kaplan, Robert D. (2000). The Coming Anarchy: Shattering the Dreams of the Post Cold War. New York : Random House, 2000.
Kaufmann, Daniel, Kraay, Aart, and Zoido-Lobatón Pablo (1999). Governance Matters. World bank Policy Research Working Paper 2 196.
Kaufman, Robert R. and Stallings, Barbara (1991). The Political Economy of Latin American Populism. – In: Macroeconomics of Populism in Latin America. Ed. By R. Dornbush and S. Edwards. Chicago and London, 1991.
Knott, J.H., G.J. Miller (1987). Reforming Bureaucracy. The Politics of Institutional Choice. Prentice-Hall, Englewood Cliffs, New Jersey. 290 pp.
Liew, Leong. Marketization, Democracy and Economic Growth in China. – In: Beyond the Asian Crisis: Pathways To Sustainable Growth. Ed. By A. Chowdhury, I. Islam. Northampton, MA, Edward Elgar, 2001, pp. 300-23.
Naughton, Barry (1997). Economic Reform in China. Macroeconomic and Overall Performance. - In: The System Transformation of the Transition Economies: Europe, Asia and North Korea. Ed. by D. Lee. Yonsei University Press, Seoul, 1997.
Nelson, Michael A., Ram D. Singh (1998). Democracy, Economic Freedom, Fiscal Policy, and Growth in LDCs: A Fresh Look. – Economic Development and Cultural Change, July 1998, Vol. 46, No. 4, pp. 677-96.
Olson, Mancur (1991). Autocracy, Democracy and Prosperity. – In: Zeckhauser, Richard J. Strategy and Choice, Cambridge, MIT Press, 1991, pp. 131-57.
Olson, Mancur (2000). Power and Prosperity: Outgrowing Communist and Capitalist Dictatorships. Basic Books, 2000.
Polterovich, Victor (1998). Institutional Traps and Economic Reforms. Working Paper # 98/004. New Economic School, Moscow, 1998.
Polterovich, Victor (2002). Political Culture and Transformational Recession. A Comment on the article by A. Hillman “En Route to the Promised Land” – Economics and Mathematical Methods, 2002 (in Russian).
Polterovich, Victor, V. Popov (2002). Accumulation of Foreign Exchange Reserves and Long Term Economic Growth. Paper presented at 10th NES Anniversary conference. Moscow, December 2002
Polterovich, Victor, V. Popov (2004). Appropriate Economic Policies at Different Stages of Development. NES, 2004.
Polterovich, Victor, V. Popov, A. Tonis, (2006). Resource Abundance, Political Corruption and Instability of Democracy. NES Working paper, 2006.
Popov, Vladimir (2000). Shock Therapy versus Gradualism: The End of the Debate (Explaining the magnitude of the Transformational Recession). – Comparative Economic Studies, Vol. 42, No.1, Spring 2000.
Popov, V. (2006). Shock Therapy versus Gradualism Reconsidered: Lessons from Transition Economies after 15 Years of Reforms. TIGER Working paper No. 82, 2006.
Przeworski, Adam and Limongi, Fernando (1993). Political Regimes and Economic Growth. – Journal of Economic Perspectives, Vol. 7, No. 3, Summer 1993, pp. 51-69.
Przeworski, Adam, Michael E. Alvarez, José Antonio Cheibub, and Fernando Limongi (2000). Democracy and Development: Political Institutions and Well-Being in the World, 1950-1990. Cambridge University Press, 2000.
Rawls, John (1971). A Theory of Justice. Cambridge, Massachusetts: Belknap Press of Harvard University Press, 1971.
Rodriguez, Francisco and Dani Rodrik (1999). TRADE POLICY AND ECONOMIC GROWTH: A Skeptic’s Guide to the Cross-National Evidence. CEPR Discussion Paper No. 2143
Rodrik, Dani (1995). Understanding Economic Policy Reform. – Journal of Economic Literature, 1995, Vol. 34, 9-41.
Rodrik, Dani (1996a). Why Do More Open Economies Have Bigger Governments? NBER working paper 5537. April 1996
Rodrik, Dani (1996b). Institutions and Economic Performance in East and South East Asia. In Round Table Conference: The Institutional Foundations of Economic Development in East Asia. Tokyo, December 1996, pp. 391-429.
Rodrik, Dani (1997). December 1997. Democracy and Economic Performance. A paper for a conference in South Africa.
Rodrik, Dani, Arvind Subramanian and Francesco Trebbi (2002). Institutions Rule: The Primacy of Institutions over Geography and Integration in Economic Development. October 2002
Rodrik, Dani, Romain Wacziarg (2005). Do Democratic Transitions Produce Bad Economic Outcomes? – American Economic Review, Papers and Proceedings, vol. 95, no. 2, May 2005, 50- 55.
Ross, Michael (2001). Does Oil Hinder Democracy? – World Politics 53 (April 2001), 325-61.
Ross, Michael (2006). Is Democracy Is Good for the Poor? –American Journal of Political Science, Vol. 50, No. 4, October 2006, pp. 860-874.
Sachs, Jeffrey D. (1989). Social Conflict and Populist Policies in Latin America. NBER Working Paper 2897. Cambridge, Mass., 1989.
Sen, Amartya (1997). Human Rights and Asian Values: What Lee Kuan Yew and Lee Peng Don’t Understand About Asia. – The New Republic, July 14, 1997, Vol. 217, No. 2-3.
Sen, Amartya (1999). The Value of Democracy. – Development Outreach, Summer 1999, pp. 5-9.
Stiglitz, Josef (1998). More Instruments and Broader Goals: Moving Toward the Post-Washington Consensus. WIDER Annual Lecture. WIDER/UNU, 1998.
Stiglitz, Josef (1999). Whither Reform? Ten Years of Transition. World Bank's Annual Bank Conference on Development Economics, Wash., D. C., April 28-30, 1999.
Triesman, Daniel (1999). The Causes of Corruption: A Cross-National Study. - Fifth Nobel Symposium in Economics. Stockholm, September 10-12, 1999.
UNDP (2002). Human Development Report 2002. Deepening democracy in a fragmented world. UNDP, 2002.
World Bank (1996a). From Plan to Market. World Development Report, NY: Oxford University Press, 1996.
World Bank, (1996b). The Chinese Economy. Fighting Inflation, Deepening Reforms. A World Bank Country Study, Washington, DC: World Bank, 1996.
World Bank (1997). The State in A Changing World. World Development Report, NY: Oxford University Press, 1997a.
World Bank (2001). World Development Indicators 2001.
World Bank (2002). Transition. The First Ten Years. 128 pp.
World Development Institute (WDI, 2001). Worldwide Governance Research Indicators Datasets, 2000/01 and 1997/98
Zakaria, Fareed (2003). The Future of Freedom : Illiberal Democracy at Home and Abroad. New York : W.W. Norton & Co, 2003.