Democracy and institutional quality: Theory and Evidence

Tommy Krieger

VfS Annual Conference 2019 (Leipzig): 30 Years after the Fall of the Berlin Wall - Democracy and Market Economy from Verein für Socialpolitik / German Economic Association

Abstract: We present a simple model that illustrates how democracy may improve the quality of economic institutions. The model further suggests that institutional quality varies more across autocracies than across democracy and that the positive effect of democracy on institutional quality is increasing in people's human capital. Using a new panel data set, covering 140 countries and the period from 1920 to 2015, and different measures of institutional quality, we present results from fixed effect and two-stage least squares regressions that confirm the predictions of our model.

Keywords: Democracy; Development; Economic Institutions; Human Capital; Institutional Quality; Political Economy; Political Transitions; Private Property Rights (search for similar items in EconPapers)
JEL-codes: D73 H11 O43 P14 P48 (search for similar items in EconPapers)
Date: 2019
New Economics Papers: this item is included in nep-gro
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc19:203507

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