Jobs with development agencies
Should market liberalisation precede democracy?: causal relations between political preferences and development
Can liberalisation before democratisation help developing countries?
Authors:
P. Grosjean; P. Senik
Publisher:
European Bank for Reconstruction and Development , 2007
This paper debates whether democratisation must happen after market liberalisation has taken place. Focusing on the relationship between market development and democracy, the authors ask whether it is true that demand for democracy only emerges after a certain degree of market development is reached, and whether it is likely to be an obstacle to the acceptance of market liberalisation.
The paper suggests that in transition countries, democracy appears to generate some popular support for a market economy, while economic liberalisation does not clearly increase support for democracy.
Key concluding points include:
- democracy increases subjective support for the market; it does not mean that democracy does not complicate the task of reformers, with the risk of impeding market liberalisation
- the results cast doubt on the idea that democracy need naturally emerge as a by-product of capitalism, particularly in less developed countries
- data does not support the idea that market liberalisation as such is sufficient to trigger the demand for democracy; identically, citizens of countries with less developed markets do not appear to be less supportive of democracy.
