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Capitalism and (versus?) democracy: stock markets and democratization in transition

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  • Christopher A. Hartwell

Abstract

This article takes a look at the determinants of democracy in transition economies, with reference to the role of financial markets. Using three different proxies for financial market development, I find that stock exchanges appear to correlate with lower levels of democracy on average, although the most successful democracies also have the largest stock markets. Nonlinearities thus appear to exist in the relationship between financial markets and political institutions in transition.

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  • Christopher A. Hartwell, 2014. "Capitalism and (versus?) democracy: stock markets and democratization in transition," Applied Economics Letters, Taylor & Francis Journals, vol. 21(14), pages 979-983, September.
    • Handle: RePEc:taf:apeclt:v:21:y:2014:i:14:p:979-983
    DOI: 10.1080/13504851.2014.902018
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    References listed on IDEAS

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    1. Clague, Christopher & Keefer, Philip & Knack, Stephen & Olson, Mancur, 1996. "Property and Contract Rights in Autocracies and Democracies," Journal of Economic Growth, Springer, vol. 1(2), pages 243-276, June.
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    3. Robert J. Barro, 1999. "Determinants of Democracy," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages 158-183, December.
    4. repec:cup:apsrev:v:53:y:1959:i:01:p:69-105_00 is not listed on IDEAS
    5. Billmeier, Andreas & Massa, Isabella, 2009. "What drives stock market development in emerging markets--institutions, remittances, or natural resources?," Emerging Markets Review, Elsevier, vol. 10(1), pages 23-35, March.
    6. Miletkov, Mihail & Wintoki, M. Babajide, 2012. "Financial development and the evolution of property rights and legal institutions," Emerging Markets Review, Elsevier, vol. 13(4), pages 650-673.
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    Cited by:

    1. Christopher Hartwell, 2022. "Institutions and trade‐related inequality," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(3), pages 3246-3264, July.
    2. Ajide Folorunsho M., 2019. "Institutional Quality, Economic Misery and Crime Rate in Nigeria," Economics and Business, Paradigm, vol. 33(1), pages 170-182, January.

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