Party Strength and Economic Growth

74 Pages Posted: 8 Sep 2015 Last revised: 24 May 2016

See all articles by Fernando Bizzarro

Fernando Bizzarro

Harvard University, Department of Government

John Gerring

University of Texas at Austin

Allen Hicken

University of Michigan at Ann Arbor - Department of Political Science

Carl Henrik Knutsen

University of Oslo - Department of Political Science

Michael Bernhard

University of Florida

Svend-Erik Skaaning

Aarhus University

Michael Coppedge

University of Notre Dame - Kellogg Institute; University of Notre Dame, Department of Political Science

Staffan I. Lindberg

Göteborg University - Varieties of Democracy Institute; Göteborg University - Department of Political Science

Date Written: September 1, 2015

Abstract

This study argues that strong parties play a critical role in fostering economic development. The theory explores how parties broaden the constituencies to which policy makers respond and help politicians to solve coordination problems. These features ensure that politicians engage in better economic management, provide productivity enhancing public services, and help ensure political (and thus policy) stability. This, in turn, should enhance economic growth.

Drawing on a novel measure of party strength from the Varieties of Democracy dataset, we test this hypothesis on data from more than 150 countries, with time series extending from 1900 to 2012. We identify a sizeable and highly significant effect, and one that is robust to a variety of specifications, estimators, and samples. The effect operates in both democracies and autocracies and is fairly stable across various regions of the world and across time periods. We also provide suggestive evidence about causal mechanisms, focusing on measures of economic management, public goods, and political stability.

This paper contributes to two large literatures, respectively focusing on features of political parties and on the institutional determinants of growth. While previous studies have highlighted the role of parties in improving the quality of governance such claims are usually limited in context – to democratic or authoritarian settings – and generally do not pertain to distal outcomes such as per capita GDP growth. Studies of economic development, while focused explicitly on growth, generally identify other long-run causal factors at work, e.g., geography, property rights, political constraints, colonial origins, inequality, social capital, or human capital.

Suggested Citation

Bizzarro, Fernando and Gerring, John and Hicken, Allen and Knutsen, Carl Henrik and Bernhard, Michael and Skaaning, Svend-Erik and Coppedge, Michael and Lindberg, Staffan I., Party Strength and Economic Growth (September 1, 2015). V-Dem Working Paper 2015:10. Available at SSRN: https://ssrn.com/abstract=2657399 or http://dx.doi.org/10.2139/ssrn.2657399

Fernando Bizzarro

Harvard University, Department of Government ( email )

1737 Cambridge Street
Cambridge, MA 02138
United States

HOME PAGE: http://https://scholar.harvard.edu/fernandobizzarro

John Gerring (Contact Author)

University of Texas at Austin ( email )

2317 Speedway
Austin, TX 78712
United States

Allen Hicken

University of Michigan at Ann Arbor - Department of Political Science ( email )

Ann Arbor, MI 48109
United States

Carl Henrik Knutsen

University of Oslo - Department of Political Science ( email )

Moltke Moesvei 31
Olso, 0851
Norway

Michael Bernhard

University of Florida ( email )

Svend-Erik Skaaning

Aarhus University ( email )

Bartholins Allé 7
Aarhus, 8000
Denmark

Michael Coppedge

University of Notre Dame - Kellogg Institute ( email )

Hesburgh Center
Notre Dame, IN 46556
United States

University of Notre Dame, Department of Political Science

216 Hesburgh Center
Notre Dame, IN New South Wales 46556-5646
United States

HOME PAGE: http://www.nd.edu/~mcoppedg/crd

Staffan I. Lindberg

Göteborg University - Varieties of Democracy Institute ( email )

Sprängkullsgatan 19
Gothenburg, Gothenburg 405 30
Sweden

HOME PAGE: http://www.pol.gu.se/varianter-pa-demokrati--v-dem-/

Göteborg University - Department of Political Science ( email )

Box 711
Gothenburg, S-405 30
Sweden

HOME PAGE: http://www.pol.gu.se

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