Labour markets and representative institutions: evidence from colonial British America
AbstractThe literature has identified the quality of political institutions in the transition region as an essential but understudied component of growth, transition and reform. This paper aims to disentangle the determinants of democratic institutions by investigating if high income inequality is always detrimental to the emergence and stability of such regimes, and under what circumstances labour scarcity can mitigate its adverse effect. Instead of using a crosscountry data set of transition countries covering only 20 years and prone to simultaneity and reverse causality, I present a quantitative analysis of suffrage restrictions in the 13 British American colonies from their establishment to the American Revolution. I show that in cases of a labour shortage elites use the right to vote as a tool to attract workers. Democratic institutions thus emerge despite high inequality and redistribution pressures, and only when labour demand eases do those in power have an incentive to contract the suffrage, as predicted by standard inequality-democracy arguments. Using a new and unique colony-level panel data set covering nearly 150 years, I estimate that a 10 percentage point decrease in the scarcity of labour, conditional on inequality and other controls, decreases the inclusiveness of political institutions by over 8 per cent in the short run, and by close to 20 per cent in the long run.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by European Bank for Reconstruction and Development, Office of the Chief Economist in its series Working Papers with number 134.
Length: 33 pages
Date of creation: Oct 2011
Date of revision:
Publication status: Published in Working papers 134, European Bank for Reconstruction and Development
Contact details of provider:
Postal: One Exchange Square, London EC2A 2JN
Web page: http://www.ebrd.com/pages/research/publications/workingpapers.shtml
More information through EDIRC
democratisation; institutions; colonialism;
Find related papers by JEL classification:
- P48 - Economic Systems - - Other Economic Systems - - - Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies
- D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- N41 - Economic History - - Government, War, Law, International Relations, and Regulation - - - U.S.; Canada: Pre-1913
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Graziella Bertocchi & Chiara Strozzi, 2008.
"International Migration and the Role of Institutions,"
Center for Economic Research (RECent)
012, University of Modena and Reggio E., Dept. of Economics.
- Graziella Bertocchi & Chiara Strozzi, 2008. "International migration and the role of institutions," Public Choice, Springer, vol. 137(1), pages 81-102, October.
- Abhijit Banerjee & Lakshmi Iyer, 2005.
"History, Institutions, and Economic Performance: The Legacy of Colonial Land Tenure Systems in India,"
American Economic Review,
American Economic Association, vol. 95(4), pages 1190-1213, September.
- Abhijit Banerjee & Lakshmi Iyer, 2010. "History Institutions and Economic Performance: The Legacy of Colonial Land Tenure Systems in India," Working Papers id:2811, eSocialSciences.
- Easterly, William, 2007. "Inequality does cause underdevelopment: Insights from a new instrument," Journal of Development Economics, Elsevier, vol. 84(2), pages 755-776, November.
- Baqir, Reza & Easterly, William & Alesina, Alberto, 1999.
"Public Goods and Ethnic Divisions,"
4551797, Harvard University Department of Economics.
- Alesina, Alberto & Baqir, Reza & Easterly, William, 1999. "Public goods and ethnic divisions," Policy Research Working Paper Series 2108, The World Bank.
- Alberto Alesina & Reza Baqir & William Easterly, 1997. "Public Goods and Ethnic Divisions," NBER Working Papers 6009, National Bureau of Economic Research, Inc.
- Alberto Abadie & Alexis Diamond & Jens Hainmueller, 2007.
"Synthetic Control Methods for Comparative Case Studies: Estimating the Effect of California's Tobacco Control Program,"
NBER Technical Working Papers
0335, National Bureau of Economic Research, Inc.
- Alberto Abadie & Alexis Diamond & Jens Hainmueller, 2007. "Synthetic Control Methods for Comparative Case Studies: Estimating the Effect of California's Tobacco Control Program," NBER Working Papers 12831, National Bureau of Economic Research, Inc.
- Gustavo J Bobonis, 2008. "Endowments, Coercion, and the Historical Containment of Education," Working Papers tecipa-335, University of Toronto, Department of Economics.
- Sebastian Braun & Michael Kvasnicka, 2009.
"Men,Women, and the Ballot – Woman Suffrage in the United States,"
Ruhr Economic Papers
0093, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
- Sebastian Braun & Michael Kvasnicka, 2009. "Men, Women, and the Ballot Woman Suffrage in the United States," SFB 649 Discussion Papers SFB649DP2009-016, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
- Beck, Thorsten & Laeven, Luc, 2006.
"Institution Building and Growth in Transition Economies,"
CEPR Discussion Papers
5718, C.E.P.R. Discussion Papers.
- Beck, Thorsten & Laeven, Luc, 2005. "Institution building and growth in transition economies," Policy Research Working Paper Series 3657, The World Bank.
- Beck, T.H.L. & Laeven, L., 2006. "Institution building and growth in transition economies," Open Access publications from Tilburg University urn:nbn:nl:ui:12-4295080, Tilburg University.
- David Y. Albouy, 2008.
"The Colonial Origins of Comparative Development: An Investigation of the Settler Mortality Data,"
NBER Working Papers
14130, National Bureau of Economic Research, Inc.
- Albouy, David, 2006. "The Colonial Origins of Comparative Development: An Investigation of the Settler Mortality Data," Center for International and Development Economics Research, Working Paper Series qt8kt576x8, Center for International and Development Economics Research, Institute for Business and Economic Research, UC Berkeley.
- Lena Edlund, 2005. "Sex and the City," Scandinavian Journal of Economics, Wiley Blackwell, vol. 107(1), pages 25-44, 03.
- Ticchi, Davide & Vindigni, Andrea, 2008.
"War and Endogenous Democracy,"
IZA Discussion Papers
3397, Institute for the Study of Labor (IZA).
- Ticchi, Davide & Vindigni, Andrea, 2007. "War and endogenous democracy," POLIS Working Papers 97, Institute of Public Policy and Public Choice - POLIS.
- Davide Ticchi & Andrea Vindigni, 2007. "War and Endogenous Democracy," Working Papers 0715, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2007.
- Ticchi, Davide & Vindigni, Andrea, 2007. "War and Endogenous Democracy," Papers 03-10-2008b, Princeton University, Research Program in Political Economy.
- Robert E. Gallman & John Joseph Wallis, 1992. "American Economic Growth and Standards of Living before the Civil War," NBER Books, National Bureau of Economic Research, Inc, number gall92-1, May.
- Basher, Syed A. & Lagerlöf, Nils-Petter, 2008. "Per-capita income gaps across US states and Canadian provinces," Journal of Macroeconomics, Elsevier, vol. 30(3), pages 1173-1187, September.
- Engerman,Stanley L. & Gallman,Robert E. (ed.), 1996. "The Cambridge Economic History of the United States," Cambridge Books, Cambridge University Press, number 9780521394420, October.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Olga Lucas).
If references are entirely missing, you can add them using this form.