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Political Constraints and Public Support for Market Reform


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  • Raj M. Desai

    (International Monetary Fund)

  • Anders Olofsg�rd

    (International Monetary Fund)


As concerns of "reform fatigue" in lower- and middle-income countries have become more widespread, so has the search for ways of boosting support for market-oriented reforms. Although the effects of political institutions on reform results have been extensively analyzed, there has been relatively little investigation of their effects on public opinion. We argue that constitutional and extra-constitutional reforms that place limits on the discretionary authority of public officials and enable voters to monitor, reward, and sanction politicians can enhance the legitimacy of market reforms. We present a voting model with asymmetric information to illustrate that these formal-legal reforms provide a credible signal of reformers' commitments. Using panel data based on public opinion barometers from Eastern Europe and Latin America, we examine the effects of political authority on public support for markets. We find that constraints on the power of the executive branch boost support for markets but that this effect declines as the reform process matures. Copyright 2006, International Monetary Fund

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Article provided by Palgrave Macmillan in its journal IMF Staff Papers.

Volume (Year): 53 (2006)
Issue (Month): si ()
Pages: 5

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Handle: RePEc:pal:imfstp:v::y:2006:i:si:p:5

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Cited by:
  1. Apolte, Thomas & Peters, Heiko, 2009. "Governance, Demokratie und wirtschaftliche Entwicklung in den ehemals sozialistischen Staaten," IÖB-Diskussionspapiere, University of Münster, Institute for Economic Education 1/09, University of Münster, Institute for Economic Education.
  2. Pauline Grosjean & Frantisek Ricka & Claudia Senik, 2011. "Learning, political attitudes and the crisis in transition countries," Working Papers, European Bank for Reconstruction and Development, Office of the Chief Economist 140, European Bank for Reconstruction and Development, Office of the Chief Economist.
  3. Grosfeld, Irena & Senik, Claudia, 2008. "The Emerging Aversion to Inequality. Evidence from Poland 1992-2005," CEPREMAP Working Papers (Docweb), CEPREMAP 0805, CEPREMAP.
  4. repec:hal:wpaper:halshs-00586788 is not listed on IDEAS


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