Fostering Civil Society to Build Institutions: Why and When

41 Pages Posted: 10 Dec 2008

See all articles by Peter Grajzl

Peter Grajzl

Washington and Lee University - Department of Economics; CESifo

Peter Murrell

University of Maryland - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: 2008-09-22

Abstract

We revisit the ubiquitous claim that aiding civil society improves institutional outcomes. In our model, a vibrant civil society initiates public debate in a reform process otherwise dominated by partisan interest groups and politicians. Civil society involvement can alleviate or aggravate adverse selection problems that arise because interest groups are better informed about reform consequences than politicians. Since aid increases the cost to the politician of excluding civil society, it affects institution building. We show analytically, and illustrate empirically, that the welfare implications of fostering civil society critically depend on the specifics of local politics, thereby casting new light on the experience of civil society aid in transition and developing countries.

Suggested Citation

Grajzl, Peter and Murrell, Peter, Fostering Civil Society to Build Institutions: Why and When (2008-09-22). Economics of Transition, Vol. 17, Issue 1, pp. 1-41, January 2009. Available at SSRN: https://ssrn.com/abstract=1314564 or http://dx.doi.org/10.1111/j.1468-0351.2009.00349.x

Peter Grajzl (Contact Author)

Washington and Lee University - Department of Economics ( email )

Lexington, VA 24450
United States

HOME PAGE: http://home.wlu.edu/~grajzlp/

CESifo ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

Peter Murrell

University of Maryland - Department of Economics ( email )

College Park, MD 20742
United States
301-405-3476 (Phone)
301-405-3542 (Fax)

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