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Constitutions and Economic Development: Evidence from the American Indian Nations

Author

Listed:
  • Akee, Randall K. Q.

    () (University of California, Los Angeles)

  • Jorgensen, Miriam

    () (University of Arizona)

  • Sunde, Uwe

    () (University of Munich)

Abstract

This paper presents an empirical examination of economic and institutional development. Utilizing a novel data set on American Indian tribal nations, we investigate how constitutional design affects economic development, while holding the broader legal and political environment fixed. Instrumental variables regressions, using the party of the US President at the time of the initial adoption of tribal constitutions as an instrument for constitutional design, indicate that parliamentary systems (versus presidential) have a strong positive effect on economic development, while ordinary least squares regressions of current economic outcomes on parliamentary systems of government show no effects. Robustness checks suggest that the results are not explained by differences in other institutions or geographic characteristics. Additional results provide some suggestive evidence that the effects may operate through channels that are typically associated with parliamentary systems, such as larger public employment, and more equitable income distribution.

Suggested Citation

  • Akee, Randall K. Q. & Jorgensen, Miriam & Sunde, Uwe, 2012. "Constitutions and Economic Development: Evidence from the American Indian Nations," IZA Discussion Papers 6754, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp6754
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    References listed on IDEAS

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    1. Lakshmi Iyer, 2010. "Direct versus Indirect Colonial Rule in India: Long-Term Consequences," The Review of Economics and Statistics, MIT Press, vol. 92(4), pages 693-713, November.
    2. Enrico Spolaore & Romain Wacziarg, 2013. "How Deep Are the Roots of Economic Development?," Journal of Economic Literature, American Economic Association, vol. 51(2), pages 325-369, June.
    3. Ferraz, Claudio & Finan, Frederico S., 2008. "Motivating Politicians: The Impacts of Monetary Incentives on Quality and Performance," IZA Discussion Papers 3411, Institute for the Study of Labor (IZA).
    4. James E. Alt & David D. Lassen, 2008. "Political And Judicial Checks On Corruption: Evidence From American State Governments," Economics and Politics, Wiley Blackwell, vol. 20(1), pages 33-61, March.
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    Cited by:

    1. Fernando M. Aragon, 2014. "Do better property rights improve local income?: Evidence from First Nations' treaties," Discussion Papers dp14-02, Department of Economics, Simon Fraser University.
    2. Aragón, Fernando M., 2015. "Do better property rights improve local income?: Evidence from First Nations' treaties," Journal of Development Economics, Elsevier, vol. 116(C), pages 43-56.
    3. Dimitrova-Grajzl, Valentina & Grajzl, Peter & Guse, A. Joseph & Todd, Richard M., 2015. "Consumer credit on American Indian reservations," Economic Systems, Elsevier, vol. 39(3), pages 518-540.
    4. Donna L. Feir, 2016. "The long-term effects of forcible assimilation policy: The case of Indian boarding schools," Canadian Journal of Economics, Canadian Economics Association, vol. 49(2), pages 433-480, May.
    5. Valentina Dimitrova-Grajzl & Peter Grajzl & A. Joseph Guse & Richard M. Todd & Michael Williams, 2015. "Neighborhood Racial Characteristics, Credit History, and Bankcard Credit in Indian Country," CESifo Working Paper Series 5594, CESifo Group Munich.

    More about this item

    Keywords

    constitutional design; economic development; political economy;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • N12 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - U.S.; Canada: 1913-
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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