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Which membership matters? External vs. internal determinants of institutional change in transition countries

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  • Drautzburg, Thorsten
  • Melnykovska, Inna
  • Schweickert, Rainer

Abstract

This paper analyses potential internal and external determinants of institutional change as measured by the World Bank Governance Indicators (WBGI) based on a panel of 25 transition countries for the period from 1996 to 2005. We show that natural resources and capital inflows exert an insignificant or negative influence and that economic policy allows to break path-dependency. Most importantly, however, we are able to show that incentives provided by NATO membership are important for institutional development and even more robust than variables measuring the integration into the EU. This allows for some optimism about the effectiveness of ENP policies and supports the argument that NATO, offering regional security, may provide significant additional incentives for good governance.

Suggested Citation

  • Drautzburg, Thorsten & Melnykovska, Inna & Schweickert, Rainer, 2008. "Which membership matters? External vs. internal determinants of institutional change in transition countries," Kiel Working Papers 1421, Kiel Institute for the World Economy.
    • Handle: RePEc:zbw:ifwkwp:1421
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    References listed on IDEAS

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    Cited by:

    1. Thorsten Drautzburg & Andrea Gawrich & Inna Melnykovska, 2008. "Institutional Convergence of CIS Towards European Benchmarks," CASE Network Reports 0082, CASE-Center for Social and Economic Research.

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    Keywords

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    JEL classification:

    • P30 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - General
    • F20 - International Economics - - International Factor Movements and International Business - - - General
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
    • F15 - International Economics - - Trade - - - Economic Integration
    • P20 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - General
    • F50 - International Economics - - International Relations, National Security, and International Political Economy - - - General

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