The effects of political arrangements on economic performance

The first research topic of this initiative is exploring the effects of political arrangements on economic performance. The primary goal is to explore whether and how varieties of democracy and authoritarianism influence economic growth; capital formation; equity and other financial markets; wages and employment; types of regulation; clientelism and corruption; intellectual property protection and the establishment and maintenance of the rule of law.  Democracies vary widely in their institutional forms and their interactions: parliamentarism and presidentialism; the number of parties; and party governance: methods of candidate selection, the number of veto players, and institutional strength. Authoritarian systems vary in their mechanisms of leadership turnover and renewal; party governance and career advancement; the number of veto players; clientelism and corruption; and institutional strength. Reliable data on some of these systems can be hard to come by, but there is considerable variation among them that needs to be better understood.

The effects of societal and economic factors on political arrangements

The second area of research deals with the effects of societal and economic factors on political arrangements. The goal here mirrors that of the first research topic: exploring how changes in the economy and society affect the political system. Institutions are to some degree endogenous: district demographics and districting give legislators stronger delegation to party leaders for the sake of coordinating on public goods (versus preserving personal voter connections at the cost of public policy). Other independent variables include the decline of organized labor and unions; technology and globalization; diversification and de-diversification of the economy; inequality and wage-stagnation; variation in direction and rates of economic mobility; and prevalence of identity versus distributive politics.  Dependent variables will include the number and strength of political parties; the nature and direction of political reform.  Aspects of gender equality are, in turn, an independent and dependent variable: strong levels of women’s organization can break open clientelist deals; and more vigorous political competition will have to respond to female voters. Weak regimes are often organized around ethnicity, caste, or religion rather than programmatic parties.  Typically blamed, but requiring further study, are low levels of average income and/or high levels of inequality. If “identity politics” is the result, at least in part, of politicians’ attempts to offer cheap substitutes for difficult policies, political competition even in these divided societies should force politicians to deliver better economic outcomes. But the interaction with types (what institutional settings) and levels of competition (national, local, intraparty) are likely to be decisive.