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Discussion Paper Details

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Title: Democracy and Reforms

Author(s): Paola Giuliano, Prachi Mishra and Antonio Spilimbergo

Publication Date: March 2009

Keyword(s): economic liberalization, financial markets, institutions, political economy, product markets and transition

Programme Area(s): Development Economics, International Macroeconomics and International Trade and Regional Economics

Abstract: Empirical evidence on the relationship between democracy and economic reforms is scarce, limited to few reforms and countries and for few years. This paper studies the impact of democracy on the adoption of economic reforms using a new dataset on reforms in the financial, capital, public, and banking sectors, product and labor 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 no evidence that economic reforms foster democracy. Our results are robust to the inclusion of a large variety of controls and estimation strategies.

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Bibliographic Reference

Giuliano, P, Mishra, P and Spilimbergo, A. 2009. 'Democracy and Reforms'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=7194