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The Golden Hello and Political Transitions

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  • Toke, A.S.
  • Albornoz, F.
  • Gassebner, M.

Abstract

We analyze the influence of IMF and World Bank programs on political regime transitions. We develop an extended version of Acemoglu and Robinson's [American Economic Review 91, 2001] model of political transitions to show how the anticipation of new loans from international financial institutions can trigger political transitions which would not otherwise have taken place. We test this unexplored implication of the theory empirically. We find in a world sample from 1970 to 2002 that the anticipation of receiving new programs immediately after a political regime transition increases the probability of a transition from autocracy to democracy and reduces the probability of democratic survival.

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Bibliographic Info

Paper provided by Faculty of Economics, University of Cambridge in its series Cambridge Working Papers in Economics with number 1241.

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Date of creation: 08 Oct 2012
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Handle: RePEc:cam:camdae:1241

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Web page: http://www.econ.cam.ac.uk/index.htm

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Keywords: political transitions; autocracy; democracy; international financial institutions;

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Cited by:
  1. Facundo Albornoz & Esther Hauk, 2010. "Civil War and Foreign Influence," Working Papers 480, Barcelona Graduate School of Economics.

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