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Democracy Doesn't Always Happen Over Night: Regime Change in Stages and Economic Growth

Vanessa Boese-Schlosser¹; Markus Eberhardt^2,3

¹ Berlin Social Science Centre (WZB), Berlin, Germany · ² School of Economics, University of Nottingham, UK · ³ Centre for Economic Policy Research, UK

Abstract How substantial are the economic benefits from democratic regime change? We argue that democratisation is often not a discrete event but a two-stage process: autocracies enter into ‘episodes’ of political liberalisation which eventually culminate in regime change or not. To account for this chronology and the implicit counterfactual groups, we introduce a repeated-treatment difference-in-difference implementation capturing non-parallel trends and selection into treatment. We find that modelling regime change in two stages rather than a single event yields stronger long-run growth effects. Among democratizers, experiencing repeated episodes without regime change reduces growth in democracy whereas length of episode does not.

DOI

10.1162/rest_a_01461

Pages

1-31

Language

en

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