The Political Determinants of Liberalization: Do Ideological Cleavages Still Matter?

International Review of Economics, Vol. 58, No. 2, pp. 121-145, June 2010

32 Pages Posted: 24 Dec 2011

See all articles by Filippo Belloc

Filippo Belloc

University of Siena - Department of Economics and Statistics

Antonio Nicita

University of Siena - Department of Economics

Date Written: February 1, 2010

Abstract

We investigate the political determinants of liberalization in OECD network industries, performing a panel estimation over thirty years, through the largest and most updated sample available. Our results contrast with the traditional wisdom according to which right-wing governments do promote market-oriented policies more intensively than left-wing ones. Our findings reveal a neglected role of the so-called ‘neo-liberalism’ in promoting left-wing market-oriented policy. As a result, we claim that ideological cleavages ceased to act as determinants of the liberalization wave observed in network industries. This result is confirmed when controlling for the existing regulatory conditions that executives find when elected. Furthermore, we find that the country’s exposure to other countries’ policy initiatives acts as a positive stimulus for liberalization policies.

Keywords: Liberalization, Network Industries, Partisanship, Panel Data

JEL Classification: D72, L50, P16, C23

Suggested Citation

Belloc, Filippo and Nicita, Antonio, The Political Determinants of Liberalization: Do Ideological Cleavages Still Matter? (February 1, 2010). International Review of Economics, Vol. 58, No. 2, pp. 121-145, June 2010. Available at SSRN: https://ssrn.com/abstract=1976352

Filippo Belloc (Contact Author)

University of Siena - Department of Economics and Statistics ( email )

Piazza San Francesco 7
Siena, Siena 53100
Italy

Antonio Nicita

University of Siena - Department of Economics ( email )

Piazza S. Francesco, 7
Siena, I-53100
Italy

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