Constitutionalism and Credibility in Post-Communist Economies
Author | : Raj M. Desai |
Publisher | : |
Total Pages | : 0 |
Release | : 2006 |
Genre | : |
ISBN | : |
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There has been relatively little investigation of the relationship between constitutional transformations and the economic transition in post-communist countries. We develop a simple signaling model in which constitutionalism - a commitment to limit political power and provide judicial defense of basic rights - reinforces the credibility of pro-market candidates' electoral promises and boosts public support for economic reforms. These findings are tested using opinion poll data on public support for reform in Central and Eastern Europe, and in the former Soviet Union, in the 1990s. In a two stage procedure we show that public support for market reforms are higher in countries where incumbents have taken deliberate steps to increase political accountability and judicial independence. Public support also spurs actual economic reform.