Spillovers of Institutional Change in Africa

Abstract

While previous research has looked at the determinants of the quality of institutions, not much research has been done that looks at the determinants of institutional change. This paper examines what determines the probability of an improvement in political freedoms. Several path‐dependent variables, such as the history of political freedom, are clearly influential. In addition to that, economic openness and improvements in ethnolinguistically similar neighbouring countries turn out to significantly influence the probability of improvement. In Africa, an improvement of political freedom is associated with a 20.1% increase in the probability of improvement in neighbouring countries, keeping everything else constant. This result is robust to the inclusion of different variables, as well as different estimation techniques.