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Crises, What Crises? New Evidence on the Relative Roles of Political and Economic Crises in Begetting Reforms

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  • Nauro Campos
  • Cheng Hsiao
  • Jeffrey Nugent

Abstract

Crises beget reforms is a powerful hypothesis. But which type of crises�-�economic or political�-�are the main drivers of structural reforms? To answer this question, we construct measures of labour market and trade liberalisation and the two types of crises for a panel of about 100 developed and developing countries between 1960 and 2000. We find that political crises are more important determinants of structural reforms than economic crises. This finding is robust to the inclusion of interdependencies between crises, feedbacks between reforms, different estimators and various alternative measures of crises.

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File URL: http://www.tandfonline.com/doi/abs/10.1080/00220388.2010.492865
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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Journal of Development Studies.

Volume (Year): 46 (2010)
Issue (Month): 10 ()
Pages: 1670-1691

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Handle: RePEc:taf:jdevst:v:46:y:2010:i:10:p:1670-1691

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Cited by:
  1. Nauro Campos & Jeffrey Nugent, 2012. "The Dynamics of the Regulation of Labor in Developing and Developed Countries since 1960," William Davidson Institute Working Papers Series wp1037, William Davidson Institute at the University of Michigan.
  2. Hannes Andréasson & Niklas Elert & Nils Karlson, 2013. "Does Social Cohesion Really Promote Reforms?," WWWforEurope Working Papers series 33, WWWforEurope.
  3. Falvey, Rod & Foster, Neil & Greenaway, David, 2012. "Trade Liberalization, Economic Crises, and Growth," World Development, Elsevier, Elsevier, vol. 40(11), pages 2177-2193.

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