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Institutional Transformations, Polity and Economic Outcomes

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  • Marc Quintyn
  • Sophia Gollwitzer

Abstract

This paper tests the theoretical framework developed by North, Wallis and Weingast (2009) on the transition from closed to open access societies. They posit that societies need to go through three doorsteps: (i) the establishment of rule of law among elites; (ii) the adoption of perpetually existing organizations; and (iii) the political control of the military. We identify indicators reflecting these doorsteps and graphically test the correlation between them and a set of political and economic variables. Finally, through Identification through Heteroskedasticity we test these relationships econometrically. The paper broadly confirms the logic behind the doorsteps as necessary steps in the transition to open access societies. The doorsteps influence economic and political processes, as well as each other, with varying intensity. We also identify income inequality as a potentially important force leading to social change.

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Bibliographic Info

Paper provided by International Monetary Fund in its series IMF Working Papers with number 12/87.

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Length: 58
Date of creation: 01 Mar 2012
Date of revision:
Handle: RePEc:imf:imfwpa:12/87

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Related research

Keywords: Governance; Transition economies;

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References

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  1. Alesina, Alberto & Rodrik, Dani, 1994. "Distributive Politics and Economic Growth," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 109(2), pages 465-90, May.
  2. Daron Acemoglu & Simon Johnson & James Robinson, 2004. "Institutions As The Fundamental Cause Of Long-Run Growth," DOCUMENTOS CEDE, UNIVERSIDAD DE LOS ANDES-CEDE 002889, UNIVERSIDAD DE LOS ANDES-CEDE.
  3. Acemoglu, Daron & Johnson, Simon & Robinson, James A & Yared, Pierre, 2007. "Reevaluating the Modernization Hypothesis," CEPR Discussion Papers, C.E.P.R. Discussion Papers 6430, C.E.P.R. Discussion Papers.
  4. Zak, Paul J. & Feng, Yi, 2003. "A dynamic theory of the transition to democracy," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 52(1), pages 1-25, September.
  5. Douglass C North & John Joseph Wallis & Barry R. Weingast, 2006. "A Conceptual Framework for Interpreting Recorded Human History," NBER Working Papers 12795, National Bureau of Economic Research, Inc.
  6. Alesina, Alberto, et al, 2003. " Fractionalization," Journal of Economic Growth, Springer, Springer, vol. 8(2), pages 155-94, June.
  7. Mwangi S. Kimenyi, 2006. "Ethnicity, Governance and the Provision of Public Goods," Journal of African Economies, Centre for the Study of African Economies (CSAE), Centre for the Study of African Economies (CSAE), vol. 15(1), pages 62-99, April.
  8. Marc Quintyn & Sophia Gollwitzer, 2010. "The Effectiveness of Macroeconomic Commitment in Weak(er) Institutional Environments," IMF Working Papers 10/193, International Monetary Fund.
  9. Robert H. Bates, 2006. "Institutions and Development," Journal of African Economies, Centre for the Study of African Economies (CSAE), Centre for the Study of African Economies (CSAE), vol. 15(1), pages 10-61, April.
  10. Marc Quintyn & Geneviève Verdier, 2010. "Mother, Can I Trust the Government? Sustained Financial Deepening," IMF Working Papers 10/210, International Monetary Fund.
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