Uwe Sunde, Florian Jung, 30 May 2011

This paper revisits the seminal correlation first noted by SM Lipset in 1959: Almost without exception, stable democracies are economically well-developed. Why? The authors argue that democracy will stick only in fairly balanced economic environments. Distribution appears to matter for the longevity of democracy.

Kevin K. Tsui, 21 May 2011

It has been widely argued that natural-resource wealth is a curse that leads to corrupt politicians, closed and illiberal societies, and defunct economies. This column presents new evidence on the political impacts of oil wealth. It argues that the effects depend on geology and history, shedding light on the recent uprisings in the Middle East and North Africa.

Xuepeng Liu, Emanuel Ornelas, 11 May 2011

The economic effects of free trade agreements are widely studied, but what about their political impact? Using data from over 125 countries over the past 60 years, this column argues that by removing protectionism, free trade can lower the government’s power and hence the incentives of autocrats to hold office. All this can help strengthen democracy.

Davin Chor, Filipe Campante, 25 April 2011

Political drama continues to unfold in the Middle East. This column uncovers education’s role in the recent uprisings. It finds that one unforeseen effect of increased investment in education has been the creation of a generation of well-educated but frustrated political activists. It concludes that – in more ways than one – the Middle East autocrats have contributed to their own downfall.

Thorvaldur Gylfason, 27 March 2011

Ghana is about to become a major oil producer. The country’s newfound oil is expected to bring in many billions of dollars, changing the face of its economy. Ghana is the first African country where a major oil discovery is greeted by a well-functioning, albeit young, democracy. This column outlines how it can avoid the resource curse and take full advantage of this historic opportunity.

Uwe Sunde, Piergiuseppe Fortunato, Matteo Cervellati, 26 March 2011

The mass movement for democracy that has led to the exile of Ben Ali in Tunisia paved the way to a new awakening and raised many hopes in North Africa and the Middle East. This column reports on recent research on the historical experiences of countries that democratised during the “third wave”, to shed some light on the prospects for the future of the Arab region.

Javier Santiso, Emmanuel Frot, 27 November 2010

Do emerging-market democracies risk destabilising financial markets every time their voters go to the polls? This column presents new evidence on the effects of elections on portfolio flows. It finds that elections diminish equity flows when they bring political uncertainty.

Marc Quintyn, Geneviève Verdier, 23 September 2010

What do countries need for sustainable financial development? This column argues that protection of property rights is necessary but not sufficient. Using a sample of 160 countries from 1960 to 2005, it finds that checks and balances on power and political stability are the vital ingredients.

Daron Acemoğlu, Konstantin Sonin, Georgy Egorov, 28 February 2010

Why do bad and incompetent governments emerge and persist under a variety of different political regimes? This column presents a new insight. Even though more democratic regimes do not necessarily perform better than less democratic ones under given conditions such as during conflicts or early economic development, more democratic regimes do appear to have greater flexibility in the face of shocks.

Paul Collier, Lisa Chauvet, 21 November 2009

There is some evidence that democracies enjoy better economic growth. How do elections, a core component of democracy, impact economic policy? This says that free and fair elections in developing countries improve economic policy by disciplining governments. But infrequent or uncompetitive elections may actually make things worse.

Sambit Bhattacharyya, Roland Hodler, 13 November 2009

Resource-rich countries are often cursed by corruption and governance problems. This column shows that the natural resource curse burdens non-democracies, but countries with better democratic institutions are not corrupted by such endowments. For governments accountable to their citizens, resources can be a blessing.

David Cuberes, Michal Jerzmanowski, 15 August 2009

What explains developing countries’ greater economic volatility? This column documents the relationship between democracy and growth reversals. It argues that greater democracy, not higher income, is responsible for dampening economic volatility. Greater democratisation and economic diversification would reduce both dramatic declines and growth accelerations.

Nauro Campos, Fabrizio Coricelli, 06 August 2009

Will the current crisis reverse the past two decades of democratisation and financial liberalisation? This column documents the complex, non-linear relationship between political and financial reform. Financial liberalisation often reverses as countries move from autocracy to democracy, as “partial democracies” are less liberalised, and there are big differences between de jure and de facto liberalisation.

Hans Gersbach, 17 June 2009

How might we limit the accumulation of public debt by democratic governments? This column proposes “voting twice" – first for a deficit ceiling and second for a particular budget. Such a procedure might strike a balance between flexibility and the commitment to refrain from loading debt onto future generations.

Patricia Funk, 28 November 2008

Patricia Funk of the Universitat Pompeu Fabra talks to Romesh Vaitilingam about her research on the impact of direct democracy on government spending, which draws on over a hundred years of data on the cantons of Switzerland. The interview was recorded at the annual congress of the European Economic Association in Milan in August 2008.

Elias Papaioannou, Gregorios Siourounis, 25 October 2008

Cross-country comparisons have produced little evidence that democracy improves economic growth. This column summarises research using within-country comparisons over time to show that democratising countries realise higher long-run growth after the volatile transition period. Democracy’s value may lie in its dynamic aspects.

Daron Acemoğlu, Davide Ticchi , Andrea Vindigni, 16 June 2008

Encouraging democracy is one goal of most industrialised nations’ foreign economic policies. Formulating such policies requires an understanding of the political-economy logic governing democratic transitions. This column describes an important recent advance in theoretical thinking on the military’s role.

Antonio Ciccone, 28 February 2008

According to theory, demands for democratic change are more likely to be realised during economic downturns, which lower the cost of overthrowing autocrats. This column presents empirical evidence from Sub-Saharan Africa suggesting that recessions may indeed open a window of opportunity for democratisation.

Emmanuelle Auriol, Robert J. Gary-Bobo, 09 October 2007

Having too few members of parliament means parliament is likely to be un-representative, but it seems that having too many makes it easy for vested interests to buy influence. Simple logic suggests that the optimal number of MEPs should be proportional to the square root of the population. Empirical work suggests that nations with a much higher number of MEPs tend to be plagued by red-tape and corruption.

Emmanuelle Auriol, Robert J. Gary-Bobo, 06 August 2007

Arriving at the optimal number of representatives in a democracy involves a trade-off between the need to keep decision costs down (i.e. limiting the number of representatives involved in the decision-making process) and ensuring that the decisions made truly reflect the preferences of the citizens.



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