How populist democracy promotes market liberalization
Using a new set of micro evidence from an original survey of 28 transition countries, we show that democracy increases citizens' support for the market by guaranteeing income redistribution to inequality-averse agents. Our identification strategy relies on the restriction of the sample to inhabitants of open borders between formerly integrated countries, where people face the same level of market development and economic inequality, as well as the same historically inherited politico-economic culture. Democratic rights increase popular support for the market. This is true, in particular, of inequality-averse agents, provided that they trust political institutions. Our findings suggest that one solution to the recent electoral backlash of reformist parties in the former socialist block lies in a deepening of democracy.
|Date of creation:||Jul 2008|
|Date of revision:|
|Note:||View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00586284|
|Contact details of provider:|| Web page: https://hal.archives-ouvertes.fr/|
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.:
- Torsten Persson & Guido Tabellini, 2009.
"Democratic Capital: The Nexus of Political and Economic Change,"
American Economic Journal: Macroeconomics,
American Economic Association, vol. 1(2), pages 88-126, July.
- Torsten Persson & Guido Tabellini, 2006. "Democratic Capital: The Nexus of Political and Economic Change," NBER Working Papers 12175, National Bureau of Economic Research, Inc.
- Torsten Persson & Guido Tabellini, 2006. "Democratic capital: The nexus of political and economic change," Working Papers 308, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
- Persson, Torsten & Tabellini, Guido, 2006. "Democratic Capital: The Nexus of Political and Economic Change," CEPR Discussion Papers 5654, C.E.P.R. Discussion Papers.
- Torsten Persson & Guido Tabellini, 2006. "Democratic capital: The nexus of political and economic change," Levine's Bibliography 122247000000001304, UCLA Department of Economics.
- Eswar Prasad & Michael P. Keane, 2000. "Inequality, Transfers and Growth; New Evidence From the Economic Transition in Poland," IMF Working Papers 00/117, International Monetary Fund.
- repec:ebd:wpaper:103 is not listed on IDEAS
- Ai, Chunrong & Norton, Edward C., 2003. "Interaction terms in logit and probit models," Economics Letters, Elsevier, vol. 80(1), pages 123-129, July.
- Roland, Gerard & Verdier, Thierry, 2003.
"Law enforcement and transition,"
European Economic Review,
Elsevier, vol. 47(4), pages 669-685, August.
- Roland, G. & Verdier, T., 2000. "Law Enforcement and Transition," DELTA Working Papers 2000-25, DELTA (Ecole normale supérieure).
- Gerard Roland & Thierry Verdier, 1999. "Law Enforcement and Transition," William Davidson Institute Working Papers Series 262, William Davidson Institute at the University of Michigan.
- Roland, Gérard & Verdier, Thierry, 2000. "Law Enforcement and Transition," CEPR Discussion Papers 2501, C.E.P.R. Discussion Papers.
- Irina Denisova & Markus Eller & Timothy Frye & Ekaterina Zhuravskaya, 2007.
"Who Wants to Revise Privatization and Why? Evidence from 28 Post-Communist Countries,"
w0105, Center for Economic and Financial Research (CEFIR).
- Denisova, Irina & Eller, Markus & Frye, Timothy & Zhuravskaya, Ekaterina, 2007. "Who Wants to Revise Privatization and Why? Evidence from 28 Post-Communist Countries," CEPR Discussion Papers 6603, C.E.P.R. Discussion Papers.
- Ada Ferrer-i-Carbonell & Paul Frijters, 2002.
"How important is Methodology for the Estimates of the Determinants of Happiness?,"
Tinbergen Institute Discussion Papers
02-024/3, Tinbergen Institute.
- Ada Ferrer-i-Carbonell & Paul Frijters, 2004. "How Important is Methodology for the estimates of the determinants of Happiness?," Economic Journal, Royal Economic Society, vol. 114(497), pages 641-659, 07.
- Grosjean, Pauline & Senik, Claudia, 2007.
"Should Market Liberalization Precede Democracy? Causal Relations between Political Preferences and Development,"
IZA Discussion Papers
2889, Institute for the Study of Labor (IZA).
- Pauline Grosjean & Claudia Senik, 2007. "Should market liberalization precede democracy? Causal relations between political preferences and development," PSE Working Papers halshs-00588060, HAL.
- Grosjean, Pauline & Senik, Claudia, 2007. "Should Market Liberalization precede Democracy ? Causal Relations between Political Preferences and Development," CEPREMAP Working Papers (Docweb) 0704, CEPREMAP.
- Daron Acemoglu & María Angélica Bautista & Pablo Querubín & James A. Robinson, 2007. "Economic and Political Inequality in Development: The Case of Cundinamarca, Colombia," NBER Working Papers 13208, National Bureau of Economic Research, Inc.
- Hayo, Bernd, 2004. "Public support for creating a market economy in Eastern Europe," Journal of Comparative Economics, Elsevier, vol. 32(4), pages 720-744, December.
When requesting a correction, please mention this item's handle: RePEc:hal:psewpa:halshs-00586284. 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: (CCSD)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.