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A Spoonful of Sugar: Privatization and Popular Support for Reform in the Czech Republic

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  • John S. Earle

    (W.E. Upjohn Institute for Employment Research and Central European University)

  • Scott Gelbach

    (Departments of Political Science and Economics, University of California-Berkeley and CEFIR, Moscow)

Abstract

We analyze the role of privatization in creating a constituency for economic reform, markets, and democratic institutions, focusing on the Czech Republic. Drawing on a 1996 survey, we examine the 1459 respondents' opinions on reforms, economic policies and systems, the legitimacy of transition, and democratic values. Using ordered probit estimation, we find that receiving property through restitution is strongly associated with support for reform and markets. Concerning voucher privatization, we find positive effects for participants retaining shares, but little impact of participation alone. Our simulations suggest that policy designs have substantial consequences for citizens' support of reforms, markets, and democracy.

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Bibliographic Info

Paper provided by W.E. Upjohn Institute for Employment Research in its series Upjohn Working Papers and Journal Articles with number 02-79.

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Date of creation: Apr 2002
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Handle: RePEc:upj:weupjo:02-79

Note: A revised version of this paper appears in Economics and Politics, Vol. 15, No. 1 (March 2003). See http://ideas.repec.org/a/bla/ecopol/v15y2003i1p1-32.html. Please cite this revised version.
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Keywords: Czech; privatization; Earle; Gelbach; Upjohn;

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References

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  1. Dewatripont, Mathias & Roland, Gerard, 1995. "The Design of Reform Packages under Uncertainty," American Economic Review, American Economic Association, vol. 85(5), pages 1207-23, December.
  2. Cesar Martinelli & Mariano Tommasi, 1993. "Sequencing of Economic Reforms in the Presence of Political Constraints," UCLA Economics Working Papers 701, UCLA Department of Economics.
  3. Claessens, Stijn & Djankov, Simeon, 1999. "Ownership Concentration and Corporate Performance in the Czech Republic," Journal of Comparative Economics, Elsevier, vol. 27(3), pages 498-513, September.
  4. John Vickers & George Yarrow, 1991. "Economic Perspectives on Privatization," Journal of Economic Perspectives, American Economic Association, vol. 5(2), pages 111-132, Spring.
  5. Grigoriev, Serguei E. & Nagaev, Serguei A. & Wörgötter, Andreas, 1994. "Regional Economic Development and Political Attitudes of the Population of Russia: Results for the December 1993 Federal Elections," East European Series 15, Institute for Advanced Studies.
  6. Harper, Joel T., 2002. "The performance of privatized firms in the Czech Republic," Journal of Banking & Finance, Elsevier, vol. 26(4), pages 621-649, April.
  7. Dewatripont, M & Roland, G, 1992. "Economic Reform and Dynamic Political Constraints," Review of Economic Studies, Wiley Blackwell, vol. 59(4), pages 703-30, October.
  8. Roland, Gérard, 1994. "The Role of Political Constraints in Transition Strategies," CEPR Discussion Papers 943, C.E.P.R. Discussion Papers.
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Cited by:
  1. Alberto Chong & Florencio de, 2003. "The Truth about Privatization in Latin America," Yale School of Management Working Papers ysm436, Yale School of Management.
  2. Alberto Chong & Florencio Lopez-de-Silanes, 2004. "Privatization in Mexico," Research Department Publications 4373, Inter-American Development Bank, Research Department.
  3. Ingrid Nielsen & Chris Nyland & Russell Smyth & Cherrie Jiuhua Zhu, 2005. "Perceptions of Subjective Economic Well-Being and Support for Market Reform among China's Urban Population," Post-Communist Economies, Taylor & Francis Journals, vol. 17(4), pages 425-447.
  4. Doyle, Orla & Fidrmuc, Jan, 2003. "Anatomy of Voting Behaviour and Attitudes During Post-Communist Transition Czech Republic 1990-98," CEPR Discussion Papers 3801, C.E.P.R. Discussion Papers.

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