Research papers on economic development

To convey this idea we distinguish two players: citizens and leaders incumbents. While the preferences of both citizens and leaders may have evolved dramatically over the past two centuries presumably, in a democratic direction , we assume, first, that citizens of a polity are more likely to prefer a democratic regime than its leaders.

Journal of Development Economics

Yet, for our stylised argument with two groups of actors, we consider it a reasonable approximation for the relative preferences between groups. Thus, we expect economic development to have a differential effect on the power resources of citizens and leaders, with citizens improving their relative position as a society develops. However, acquiring more power resources is insufficient, by itself, for ensuring a democratic outcome. No citizen, no matter how resourceful, can effectively challenge an incumbent leader alone.

Development economics

For citizens to affect the character of national institutions, they must overcome their collective action dilemma Medina Otherwise, leaders are likely to win out, preserving power for themselves. A critical feature distinguishing electoral institutions from others is the role that elections play as a focal point for citizen action, mitigating collective action problems that would otherwise constrain popular mobilisation. On elections, and electoral fraud, as focal points, see, e. This protects against democratic backsliding, helping to ensure that electoral institutions, once established, are respected.

The focal role of elections stems from five key features of the electoral process. Second, they are highly visible. One can hardly hold elections in secret, and elections are often intensively canvassed by the media and informal networks. Third, actions that impair election quality e. Although clever leaders have developed subtle ways to manipulate elections e. At this point, it is natural for large numbers of people to mobilise if their preferences are not respected see, e.

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These characteristics set elections apart from other aspects of democracy, and the prospect of collective action ought to make leaders think twice before blatantly manipulating them. While we do not deny that infringements of civil liberties can sometimes engender collective action by regime opponents, it is less likely that such infringements will provide as clear a focal point as major electoral fraud or the cancellation of elections.

Leaders may infringe upon the right of free speech or violate the rule of law selectively, arresting a few individuals at a time without due process and allowing others to bask in false security. They may choose an opportune moment, when public attention is focused on another event of great salience e.

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They may also abridge civil liberties in a clandestine manner — for example, through disappearances managed by paramilitary groups or private contracts, thus avoiding direct responsibility. Using various tools of repression, great damage may be done to civil liberties without a high level of public awareness and without a single galvanising event prompting the general public to take action.

Additionally, elections are mass events, involving the entire citizenry under conditions of universal suffrage. This sets them apart from many other aspects of democracy, which mostly centre on leader behaviour. When citizens are empowered by education and wealth they are more able to resist the blandishments and coercions of the leader and more likely to behave in a peaceful and orderly manner — all of which contribute to a free and fair election. This is most obvious for vote buying, which is a common strategy of electoral fraud.

Importantly, focal points operate only where elections already exist. Otherwise, there is no event around which constituencies can mobilise. Hence, our argument suggests that once established, elections will combine with economic development to form a safeguard against deterioration in electoral democracy. But before electoral institutions are in place, our theory has no clear implications for how economic development might affect the fate of electoral democracy.

Yet, onsets might even be negatively associated with development, if leaders in rich autocracies can anticipate the logic of our argument — they should be fearful of providing citizens that have ample power resources with focal points for collective action. Hence, our expectations are not clear on this particular relationship. In sum, it is the combination of a resourceful, engaged citizenry which comes from economic development and a focal point allowing citizens to organise collectively provided by elections that allow for effective collective action.

Anticipating this, leaders will be hesitant to manipulate or cancel elections in developed countries. This theoretical discussion suggests several hypotheses which will orient the empirical tests that follow.

Electoral democracy thus refers here to the quality of the electoral process itself, and not the extent of participation in that election i. Following Lipset , we assume that economic development involves a set of factors, including income, industrialisation, changing sectoral composition, education, communications infrastructure and urbanisation. As such, economic development typically entails both increased specialisation in production, labour and capital markets, and social reorganization, for example, with a growing urban middle class.

As discussed, various theories propose that such processes influence prospects for regime change. For instance, the empowerment of particular social classes and increased demand for strong property rights protection stemming from new asset classes e. We further discuss issues of endogeneity and possible solutions later in the article. The chosen model features an ordinary least squares OLS estimator with country and year fixed effects, a lagged dependent variable LDV and robust errors clustered by country.

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These initial tests are shown across the first row of Table 1. Somewhat surprisingly, higher income predicts lower suffrage. Alternate specifications are reported in Online Appendix B, showing that certain aspects of democracy relate to income in some specifications — for instance, the liberal component of democracy, free expression and judicial constraints. We cannot conclusively reject the null hypothesis. Next, we examine composite indices commonly used to measure democracy in its entirety following different understandings of the concept.

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While these indices have somewhat different focuses, they are all highly aggregated, including various underlying concepts and measures. Results, shown in columns 13—16 in Table 1 , suggest that these composite indices are not clearly linked to income. These are discussed below. BMR captures whether the legislature and executive are chosen directly or indirectly in free and fair elections in which at least a majority of adult men are enfranchised.

The inclusion of suffrage is the only departure from a purely electoral indicator following our definition. Again, the suffrage criterion is the only departure from a purely electoral measure. These are combined through multiplication based on the idea that they are necessary and mutually dependent conditions for contestation.

Results are shown in columns 17— All indices bear a positive relationship to income, though BMR does not surpass conventional thresholds of statistical significance. The measure is coded 1 whenever the chief executive offices and seats in the effective legislative body are filled by multiparty elections characterised by uncertain outcomes — meaning that the elections are, in principle, sufficiently free to enable the opposition to gain government power — and 0 otherwise.

Next, we measure Clean Elections, understood as the absence of registration fraud, systematic irregularities, government intimidation of the opposition, vote buying and election violence. Results, shown in columns 20—21, support our argument, as these measures are strongly correlated with prior levels of income. These results suggest that economic development brings a substantial shift in the quality of elections. In this section, we explore alternate specifications. We focus on Competitive Elections and Clean Elections since they are narrowly targeted on the concept of theoretical interest.

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Similar robustness tests on other indices are reported in Online Appendix B. Table 2 focuses on Competitive Elections.

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Model 1 replicates our initial test — reported in column 20 from Table 1. Model 2 excludes the LDV. Model 3 substitutes a trend variable for the annual dummies.

Journal of Development Economics - Elsevier

Descriptions of these variables can be found in Table A1 in the Online Appendix. Model 5 repeats model 4 without the LDV. Model 6 returns to the benchmark but lags GDP by two decades. Finally, a large political economics literature analyses how different features of electoral processes influence economic development e.

Results are stable for alternative lag structures. We tested alternative models using different sets of controls, and results are stable. Except for model 9, the tests in Table 2 apply an OLS estimator — a choice that might seem odd given the binary outcome of interest. OLS provides ease of interpretation and consistency with estimators used for other outcomes. Yet, to relieve concerns, the tests in Table 2 are replicated with a logit estimator. Table 3 focuses on Clean Elections. Model 1 again replicates our initial test from Table 1. In terms of cost, the MTO experimental vouchers did not change the cost of housing for those in public housing.

The increased cost was helping those with vouchers find housing in low-poverty areas. Most important is that the move increased tax revenue substantially. Therefore, taxpayers may ultimately gain from the investment. MTO was a win-win policy. Their results imply that the US would have had But Ms. The authors have an incredibly neat approach, using actual worker hiring to generate causal estimates of how workers value various employment setups.

Cascio looks at states with universal vs. I think this means we have to support universal pre-k programs, and the large price tags that go along with them. Disclaimer: IMF Working Papers describe research in progress by the author s and are published to elicit comments and to encourage debate.