The Economic Effects of Direct Democracy – A First Global Assessment
This is the first study that assesses the economic effects of direct democratic institutions on a cross country basis. Its results are based on up to six new measures produced to reflect the legislative basis for using direct democratic institutions as well as their factual use. In addition, a more general overall indicator is used. On the basis of these two different data sets only some of the results of the former intra-country studies are confirmed. An analysis based on the more general democracy index for 87 countries shows that a higher degree of direct democracy leads to lower budget deficits and higher government effectiveness. The effects on government expenditure, corruption and productivity have the expected signs but do not reach conventional levels of significance. A more fine grained analysis for a cross section of 88 countries based on the second data set shows that institutional detail matters a great deal. In particular, the mere possibility of drawing on direct-democratic institutions is often not sufficient to induce significant effects whereas the frequency of their factual use has a number of substantive effects on economic variables.
|Date of creation:||2007|
|Contact details of provider:|| Postal: Poschingerstrasse 5, 81679 Munich|
Phone: +49 (89) 9224-0
Fax: +49 (89) 985369
Web page: http://www.cesifo-group.de
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Anne van Aaken & Lars P. Feld & Stefan Voigt, 2008.
"Power over Prosecutors Corrupts Politicians: Cross Country Evidence Using a New Indicator,"
MAGKS Papers on Economics
200801, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
- Anne van Aaken & Lars P. Feld & Stefan Voigt, 2008. "Power over Prosecutors Corrupts Politicians: Cross Country Evidence Using a New Indicator," CESifo Working Paper Series 2245, CESifo Group Munich.
- Matsusaka, John G & McCarty, Nolan M, 2001. "Political Resource Allocation: Benefits and Costs of Voter Initiatives," Journal of Law, Economics and Organization, Oxford University Press, vol. 17(2), pages 413-448, October.
- Mueller,Dennis C., 2003. "Public Choice III," Cambridge Books, Cambridge University Press, number 9780521894753, May.
- Pommerehne, Werner W & Weck-Hannemann, Hannelore, 1996. "Tax Rates, Tax Administration and Income Tax Evasion in Switzerland," Public Choice, Springer, vol. 88(1-2), pages 161-170, July.
- James E. Alt & David Dreyer Lassen, 2002. "The Political Economy of Institutions and Corruption in American States," EPRU Working Paper Series 02-16, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
- John G. Matsusaka, 2005. "Direct Democracy Works," Journal of Economic Perspectives, American Economic Association, vol. 19(2), pages 185-206, Spring.
- Nadia Fiorino & Roberto Ricciuti, 2007. "Determinants of Direct Democracy," CESifo Working Paper Series 2035, CESifo Group Munich.
- Beck, Thorsten & Clarke, George & Groff, Alberto & Keefer, Philip & Walsh, Patrick, 2000. "New tools and new tests in comparative political economy - the database of political institutions," Policy Research Working Paper Series 2283, The World Bank.
- Bruno S. Frey & Alois Stutzer, "undated".
"Happiness, Economy and Institutions,"
IEW - Working Papers
015, Institute for Empirical Research in Economics - University of Zurich.
- Matthias Benz & Alois Stutzer, 2004.
"Are Voters Better Informed When They Have a Larger Say in Politics? -- Evidence for the European Union and Switzerland,"
Springer, vol. 119(1_2), pages 31-59, 04.
- Matthias Benz & Alois Stutzer:, "undated". "Are Voters Better Informed When They Have a Larger Say in Politics? Evidence for the European Union and Switzerland," IEW - Working Papers 119, Institute for Empirical Research in Economics - University of Zurich.
- Torgler, Benno, 2005. "Tax morale and direct democracy," European Journal of Political Economy, Elsevier, vol. 21(2), pages 525-531, June.
- Lars P Feld & Gebhard Kirchgässner, 2001. "The political economy of direct legislation: direct democracy and local decision-making," Economic Policy, CEPR;CES;MSH, vol. 16(33), pages 329-367, October.
- Blomberg, S.B. & Hess, G.D., 1999.
"The Impact of Voter Initiatives on Economic Activity,"
99-11, Wellesley College - Department of Economics.
- Blomberg, S. Brock & Hess, Gregory D. & Weerapana, Akila, 2004. "The impact of voter initiatives on economic activity," European Journal of Political Economy, Elsevier, vol. 20(1), pages 207-226, March.
- Jessica Seddon Wallack & Alejandro Gaviria & Ugo Panizza & Ernesto Stein, 2003. "Particularism around the World," World Bank Economic Review, World Bank Group, vol. 17(1), pages 133-143, June.
- Feld, Lars P. & Schaltegger, Christoph A. & Schnellenbach, Jan, 2008. "On government centralization and fiscal referendums," European Economic Review, Elsevier, vol. 52(4), pages 611-645, May.
- Feld, Lars P & Savioz, Marcel R, 1997. "Direct Democracy Matters for Economic Performance: An Empirical Investigation," Kyklos, Wiley Blackwell, vol. 50(4), pages 507-538.
- Matsusaka, John G, 2000. "Fiscal Effects of the Voter Initiative in the First Half of the Twentieth Century," Journal of Law and Economics, University of Chicago Press, vol. 43(2), pages 619-650, October.
- Lars P. Feld & Stefan Voigt, 2003.
"Economic Growth and Judicial Independence: Cross Country Evidence Using a New Set of Indicators,"
CESifo Working Paper Series
906, CESifo Group Munich.
- Feld, Lars P. & Voigt, Stefan, 2003. "Economic growth and judicial independence: cross-country evidence using a new set of indicators," European Journal of Political Economy, Elsevier, vol. 19(3), pages 497-527, September.
- Feld, Lars P. & Matsusaka, John G., 2003. "Budget referendums and government spending: evidence from Swiss cantons," Journal of Public Economics, Elsevier, vol. 87(12), pages 2703-2724, December.
- Matsusaka, John G, 1995. "Fiscal Effects of the Voter Initiative: Evidence from the Last 30 Years," Journal of Political Economy, University of Chicago Press, vol. 103(3), pages 587-623, June.
- Roubini, Nouriel & Sachs, Jeffrey D., 1989. "Political and economic determinants of budget deficits in the industrial democracies," European Economic Review, Elsevier, vol. 33(5), pages 903-933, May.
- Nouriel Roubini & Jeffrey Sachs, 1988. "Political and Economic Determinants of Budget Deficits in the IndustrialDemocracies," NBER Working Papers 2682, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:ces:ceswps:_2149. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Klaus Wohlrabe)
If references are entirely missing, you can add them using this form.