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State Capacity and Economic Integration: Evidence from the Eastern Enlargement

László Bruszt and Nauro Campos ()

No 2017/52, RSCAS Working Papers from European University Institute

Abstract: We study whether and how economic integration increases state capacity. Despite the recent surge in economist’s interest in state capacity, there remains a lack of theory-based detailed empirical measures. This paper introduces a new panel of institutional reform measures. We present a political economy framework highlighting the Montesquieu, Weber and Smith channels and yielding hypotheses about the judiciary, bureaucracy, and competition policy. Our main finding is that the relationship between bureaucratic independence and judiciary capacity seems to be the main engine of the process of state capacity building engendered by the prospect of European Union membership.

Keywords: state capacity; institutions; deep integration. (search for similar items in EconPapers)
JEL-codes: D72 D78 H23 P11 P16 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-pol and nep-tra
Date: 2017-10
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