♠ Posted by Emmanuel in Europe
at 7/03/2007 12:24:00 AM
The Institute for the Study of Labor (IZA) has a new discussion paper out on the political economy of Eastern Europe's transition away from socialism to democracy. Pauline Grosjean of the European Bank for Reconstruction and Development (EBRD) and Claudia Senik of the Sorbonne find in their study that the relationship between market development and democracy is rather unidirectional. The J-Curve hypothesis I described a few posts back is a modern spin on the idea that economic engagement or market development eventually leads to public demand for democracy. This argument has been deployed with regard to China's emergence as a global economic powerhouse, of course. What this study demonstrates, however, is that those who believe the Chinese people will eventually demand more substantive freedoms might have to rethink their initial views.Using regression models, the authors determine that while democracy tends to increase demand for market development, the opposite does not hold. It's food for thought, especially for all of us contemplating whether China will become more democratic. The usual caveats apply, such as these Eastern European cases probably differing quite a bit from the experience of China. The former group's transition w more abrupt than China's, for example. The abstract follows:
This paper is dedicated to the relation between market development and democracy. We distinguish contexts and preferences and ask whether it is true that the demand for democracy only emerges after a certain degree of market development is reached, and whether, conversely, democratization is likely to be an obstacle to the acceptation of market liberalization. Our study hinges on a new survey rich in attitudinal variables: the Life in Transition Survey (LITS) conducted in 2006 by the European Bank for Reconstruction and Development and the World Bank, in 28 post-Transition countries. Our identification strategy consists in relying on the specific situation of frontier-zones. We find that democracy enhances the support for market development whereas the reverse is not true. Hence, the relativist argument according to which the preference for democracy is an endogenous by-product of market development is not supported by our data.
