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Income and democracy: Evidence from nonlinear estimations

  • Benhabib, Jess
  • Corvalan, Alejandro
  • Spiegel, Mark M.

We test the relation between income and democracy during the postwar period. We employ panel estimation methods that explicitly allow for the fact that the primary measures of democracy are censored with substantial mass at the boundaries. We find that the statistically significant positive income–democracy relationship is robust to the inclusion of country fixed effects.

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Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 118 (2013)
Issue (Month): 3 ()
Pages: 489-492

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Handle: RePEc:eee:ecolet:v:118:y:2013:i:3:p:489-492
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  1. Benhabib, Jess & Rustichini, Aldo, 1996. " Social Conflict and Growth," Journal of Economic Growth, Springer, vol. 1(1), pages 125-42, March.
  2. Daron Acemoglu & Simon Johnson & James A. Robinson & Pierre Yared, 2008. "Income and Democracy," American Economic Review, American Economic Association, vol. 98(3), pages 808-42, June.
  3. Jeffrey M Wooldridge, 2002. "Simple solutions to the initial conditions problem in dynamic, nonlinear panel data models with unobserved heterogeneity," CeMMAP working papers CWP18/02, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
  4. Daniel Treisman, 2011. "Income, Democracy, and the Cunning of Reason," NBER Working Papers 17132, National Bureau of Economic Research, Inc.
  5. Robert J. Barro & Jong-Wha Lee, 2010. "A New Data Set of Educational Attainment in the World, 1950-2010," NBER Working Papers 15902, National Bureau of Economic Research, Inc.
  6. Jess Benhabib & Alejandro Corvalan & Mark M. Spiegel, 2011. "Reestablishing the income-democracy nexus," Working Paper Series 2011-09, Federal Reserve Bank of San Francisco.
  7. Bobba, Matteo & Coviello, Decio, 2007. "Weak instruments and weak identification, in estimating the effects of education, on democracy," Economics Letters, Elsevier, vol. 96(3), pages 301-306, September.
  8. Enrique Moral-Benito & Cristian Bartolucci, 2011. "Income and democracy: revisiting the evidence," Banco de Espa�a Working Papers 1115, Banco de Espa�a.
  9. Akay, Alpaslan, 2009. "The Wooldridge Method for the Initial Values Problem Is Simple: What About Performance?," IZA Discussion Papers 3943, Institute for the Study of Labor (IZA).
  10. Acemoglu, Daron & Johnson, Simon & Robinson, James A & Yared, Pierre, 2007. "Reevaluating the Modernization Hypothesis," CEPR Discussion Papers 6430, C.E.P.R. Discussion Papers.
  11. Robert J. Barro, 1999. "Determinants of Democracy," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages S158-S183, December.
  12. Adam Przeworski & Jess Benhabib, 2004. "The Political Economy of Redistribution under Democracy," 2004 Meeting Papers 58, Society for Economic Dynamics.
  13. Heid, Benedikt & Langer, Julian & Larch, Mario, 2012. "Income and democracy: Evidence from system GMM estimates," Economics Letters, Elsevier, vol. 116(2), pages 166-169.
  14. Chamberlain, Gary, 1980. "Analysis of Covariance with Qualitative Data," Review of Economic Studies, Wiley Blackwell, vol. 47(1), pages 225-38, January.
  15. Natalia Ponomareva & Hajime Katayama, 2010. "Does the version of the Penn World Tables matter? An analysis of the relationship between growth and volatility," Canadian Journal of Economics, Canadian Economics Association, vol. 43(1), pages 152-179, February.
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