Working Paper: NBER ID: w18117
Authors: Paola Giuliano; Prachi Mishra; Antonio Spilimbergo
Abstract: Empirical evidence on the relationship between democracy and economic reforms is limited to few reforms, countries, and periods. This paper studies the effect of democracy on the adoption of economic reforms using a new dataset on reforms in the financial, capital and banking sectors, product markets, agriculture, and trade for 150 countries over the period 1960-2004. Democracy has a positive and significant impact on the adoption of economic reforms but there is scarce evidence that economic reforms foster democracy. Our results are robust to the inclusion of a large variety of controls and estimation strategies.
Keywords: Democracy; Economic Reforms; Political Economy; Development
JEL Codes: E60; F50
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Economic Reforms (E69) | Democracy (D72) |
| Democracy (D72) | Economic Reforms (E69) |
| Democracy (D72) | Reform Index (C43) |