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Democracy to the road: the political economy of potholes

  • Albert Saiz

Are dictatorships more prone to build and maintain roads? This paper identifies a puzzling fact: countries that are more democratic tend to have roads in worse conditions than less democratic countries. Using lagged values of a democracy index to instrument for democracy in 1980 yields higher estimates of the magnitude of the association between democracy and bad roads. Instruments based on climate, population, and education yield similar results. The evidence points to a negative causal relationship from democracy to road quality. The author also finds that changes to a more democratic government are associated with slower growth of the road network. The author advances four non-mutually exclusive hypotheses that can explain the results and find support for one of them: dictatorships prefer a better highway network ready for external and internal military intervention.

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Paper provided by Federal Reserve Bank of Philadelphia in its series Working Papers with number 02-17.

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Date of creation: 2002
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Handle: RePEc:fip:fedpwp:02-17
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  1. Barro, Robert J., 1999. "Determinants of Democracy," Scholarly Articles 3451297, Harvard University Department of Economics.
  2. Rodrik, Dani, 1998. "Democracies Pay Higher Wages," CEPR Discussion Papers 1776, C.E.P.R. Discussion Papers.
  3. Robert J. Barro, 1989. "Economic Growth in a Cross Section of Countries," NBER Working Papers 3120, National Bureau of Economic Research, Inc.
  4. Tavares, Jose & Wacziarg, Romain, 2001. "How democracy affects growth," European Economic Review, Elsevier, vol. 45(8), pages 1341-1378, August.
  5. Barro, Robert J, 1996. " Democracy and Growth," Journal of Economic Growth, Springer, vol. 1(1), pages 1-27, March.
  6. Dani Rodrik, 2000. "Institutions for High-Quality Growth: What They are and How to Acquire Them," NBER Working Papers 7540, National Bureau of Economic Research, Inc.
  7. Alesina, Alberto, et al, 1996. " Political Instability and Economic Growth," Journal of Economic Growth, Springer, vol. 1(2), pages 189-211, June.
  8. Alesina, Alberto & Perotti, Roberto, 1996. "Income distribution, political instability, and investment," European Economic Review, Elsevier, vol. 40(6), pages 1203-1228, June.
  9. Tabellini, Guido & Alesina, Alberto, 1990. "A Positive Theory of Fiscal Deficits and Government Debt," Scholarly Articles 3612769, Harvard University Department of Economics.
  10. Roubini, Nouriel & Swagel, Phillip & Ozler, Sule & Alesina, Alberto, 1996. "Political Instability and Economic Growth," Scholarly Articles 4553024, Harvard University Department of Economics.
  11. Francisco Rivera-Batiz, 2002. "Democracy, goverance and economic growth: Theory and evidence," Discussion Papers 0102-57, Columbia University, Department of Economics.
  12. Alberto Alesina & Guido Tabellini, 1987. "A Positive Theory of Fiscal Deficits and Government Debt in a Democracy," NBER Working Papers 2308, National Bureau of Economic Research, Inc.
  13. Persson, T. & Tabellini, G., 1993. "Is Inequality Harmful for Growth," Papers 537, Stockholm - International Economic Studies.
  14. Randolph, Susan & Bogetic, Zeljko & Hefley, Dennis, 1996. "Determinants of public expenditure on infrastructure : transportation and communication," Policy Research Working Paper Series 1661, The World Bank.
  15. Perotti, Roberto & Alesina, Alberto, 1996. "Income Distribution, Political Instability, and Investment," Scholarly Articles 4553018, Harvard University Department of Economics.
  16. Gwilliam, Ken & Shalizi, Zmarak, 1999. "Road Funds, User Charges and Taxes," World Bank Research Observer, World Bank Group, vol. 14(2), pages 159-85, August.
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