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Political Institutions and Growth Collapses

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Author Info

  • Gavira, Alejandro

    ()
    (National Department of Planning, Colombia)

  • Panizza, Ugo

    ()
    (Research Department of the Inter-American Development Bank)

  • Seddon, Jessica

    ()
    (Political Economist program)

  • Stein, Ernesto

    ()
    (Research Department of the Inter-American Development Bank)

Abstract

This paper tests whether Rodrik's (1999) results that institutions for conflict management are associated with the ability to react to economic shocks are robust to different ways of defining the quality of such institutions. In this paper, we measure the quality of conflict management institutions with two different indices. The first is an index of political constraints on the ability of the executive to impose its will. These constraints limit the ability of the government to arbitrarily change the rules of the game and therefore may reduce redistributive struggles. The second index measures the degree of political particularism. We define political particularism as the policymakers’ ability to further their career by catering to narrow interests rather than broader national platforms, The indices used in this paper solve the endogeneity and subjectivity biases that affect Rodrik's main measure of institutional quality We find strong support for the idea that high levels of political constraints and intermediate levels of political particularism are associated with a quick recovery from economic shocks.

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Bibliographic Info

Article provided by Instituto de Investigaciones Socio-Económicas (IISEC), Universidad Católica Boliviana in its journal Revista Latinoamericana de Desarrollo Economico.

Volume (Year): (2004)
Issue (Month): 2 (Abril)
Pages: 11-32

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Handle: RePEc:ris:revlde:0201

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Postal: Universidad católica Boliviana San Pablo, Instituto de Investigaciones Socio Económicas, Av. 14 de septiembre 4807. Obrajes, La Paz, Bolivia
Phone: (591-2) 784159
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Web page: http://www.iisec.ucb.edu.bo
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Related research

Keywords: Growght; Collapses; Political;

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Cited by:
  1. Adeel Malik & Jonathan R W Temple, 2005. "The Geography of Output Volatility," CSAE Working Paper Series 2005-07, Centre for the Study of African Economies, University of Oxford.
  2. Ugo Panizza & Mónica Yañez, 2006. "Why are Latin Americans so Unhappy about Reforms?," Research Department Publications 4469, Inter-American Development Bank, Research Department.
  3. Hallerberg, Mark & Marier, Patrick, 2001. "Executive authority, the personal vote, and budget discipline in Latin American and Carribean countries," ZEI Working Papers B 17-2001, ZEI - Center for European Integration Studies, University of Bonn.
  4. Pitlik, Hans & Wirth, Steffen, 2003. "Do crises promote the extent of economic liberalization?: an empirical test," European Journal of Political Economy, Elsevier, vol. 19(3), pages 565-581, September.
  5. Islam, Roumeen & Montenegro, Claudio E., 2002. "What determines the quality of institutions?," Policy Research Working Paper Series 2764, The World Bank.
  6. Jairo Parada C. & Alexandra García L., 2008. "Growth and Institutions in Latin America: A pooled and cross-time series analysis (1951-1999)," Revista de Economía del Caribe, UNIVERSIDAD DEL NORTE.

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