Political Support for Reforms: The Role of Unemployment and the Private Sector
26 Pages Posted: 12 May 1997
Date Written: October 1997
I perform an empirical analysis of the relationship between economics and politics in the countries in transition. I use regional results of national elections in the Czech Republic, Hungary, Poland and Slovakia to link variations in support for reforms with the economic effects of reforms across regions. I show that support for reform is endogenous--the reform engenders constituencies that support or oppose it. In particular, high unemployment decreases support for parties associated with the reform and increases support for left-wing parties. The emerging private sector in general increases support for reform and reduces support for the communists and extreme left. This general pattern holds both within countries and across countries. The electoral failures of pro-reform parties in some transition countries can then be explained by imbalance between constituencies supporting and opposing radical economic reform.
JEL Classification: E24, E61, J64, O11
Suggested Citation: Suggested Citation