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Democracy, Market Liberalization and Political Preferences

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Author Info

  • Pauline Grosjean

    (UC BERKELEY - Berkeley University of California - UC Berkeley)

  • Claudia Senik

    (EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - École des Hautes Études en Sciences Sociales [EHESS] - Ecole des Ponts ParisTech - Ecole normale supérieure de Paris - ENS Paris - Institut national de la recherche agronomique (INRA), UP4 - Université Paris 4, Paris-Sorbonne - Université Paris IV - Paris Sorbonne - Ministère de l'Enseignement Supérieur et de la Recherche Scientifique)

Abstract

This paper questions the conventional wisdom concerning the sequencing of political and economic reforms in developing countries. We exploit the specific situation of frontier-zones as well as the considerable regional variations in culture and economic development in the countries of Central and Eastern Europe and the former Soviet Union. We estimate the impact of market development and democratization on subjective political preferences. Taking advantage of a new survey conducted in 2006 by the European Bank for Reconstruction and Development and the World Bank in 28 post-transition countries, we find a positive and significant effect of democracy on support for a market economy, but no effect of market liberalization on support for democracy. Our results are robust to the use of various indices of market liberalization and democracy and alternative measures of political preferences.

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Bibliographic Info

Paper provided by HAL in its series Post-Print with number halshs-00596078.

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Date of creation: Feb 2011
Date of revision:
Publication status: Published, The Review of Economics and Statistics, 2011, 93, 1, 365-381
Handle: RePEc:hal:journl:halshs-00596078

Note: View the original document on HAL open archive server: http://halshs.archives-ouvertes.fr/halshs-00596078
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Related research

Keywords: market and democracy ; political preferences ; spatial regression discontinuity ; transition economies;

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References

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  1. James E. Anderson & Eric van Wincoop, 2003. "Gravity with Gravitas: A Solution to the Border Puzzle," American Economic Review, American Economic Association, vol. 93(1), pages 170-192, March.
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  17. Earle, John S. & Sakova, Zuzana, 2000. "Business start-ups or disguised unemployment? Evidence on the character of self-employment from transition economies," Labour Economics, Elsevier, vol. 7(5), pages 575-601, September.
  18. Schulze, Max Stephan & Wolf, Nikolaus, 2007. "On the Origins of Border Effects: Insights from the Habsburg Customs Union," CEPR Discussion Papers 6327, C.E.P.R. Discussion Papers.
  19. Dethier, Jean-Jacques & Ghanem, Hafez & Zoli, Edda, 1999. "Does democracy facilitate the economic transition : an empirical study of Central and Eastern Europe and the Former Soviet Union," Policy Research Working Paper Series 2194, The World Bank.
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Citations

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Cited by:
  1. Pauline Grosjean, 2013. "Conflict and Social and Political Preferences: Evidence from World War II and Civil Conflict in 35 European countries," Discussion Papers 2013-29, School of Economics, The University of New South Wales.
  2. Becker, Sascha O; Boeckh, Katrin; Hainz, Christa; Woessmann, Ludger, 2011. "The Empire Is Dead, Long Live the Empire! Long-Run Persistence of Trust and Corruption in the Bureaucracy," CAGE Online Working Paper Series 40, Competitive Advantage in the Global Economy (CAGE).
  3. repec:cge:warwcg:40 is not listed on IDEAS
  4. Nicolas R. Ziebarth & Gert G. Wagner, 2013. "Top-down v. Bottom-up: The Long-Term Impact of Government Ideology and Personal Experience on Values," Discussion Papers of DIW Berlin 1280, DIW Berlin, German Institute for Economic Research.
  5. Grosfeld, Irena & Rodnyansky, Alexander & Zhuravskaya, Ekaterina, 2011. "Persistent anti-market culture: A legacy of the Pale of Settlement and of the Holocaust," CEPR Discussion Papers 8316, C.E.P.R. Discussion Papers.
  6. Ilaria Petrarca & Roberto Ricciuti, 2014. "Synthetic ‘Real Socialism’: A Counterfactual Analysis of Political and Economic Liberalizations," Working Papers 11/2014, University of Verona, Department of Economics.
  7. Alessandro Olper & Valentina Raimondi, 2012. "Electoral Rules, Forms of Government and Redistributive Policy: Evidence from Agriculture and Food Policies," LICOS Discussion Papers 30512, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  8. Paola Giuliano & Prachi Mishra & Antonio Spilimbergo, 2012. "Democracy and Reforms: Evidence from a New Dataset," NBER Working Papers 18117, National Bureau of Economic Research, Inc.
  9. Friedrichsen, Jana & Zahn, Philipp, 2012. "Political Support in Hard Times: Do People Care about National Welfare?," Working Papers 12-12, University of Mannheim, Department of Economics.
  10. repec:hal:wpaper:halshs-00564927 is not listed on IDEAS
  11. Libman, A., 2013. "Between New Political Economy and Political Science: Convergence and Divergence of Disciplines," Journal of the New Economic Association, New Economic Association, vol. 17(1), pages 166-169.

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