Electoral systems and the economy: a firm-level analysis

Camyar, Isa; Ulupinar, Bahar

doi:10.1007/s10602-019-09274-6

Cited by 3 publications

(4 citation statements)

References 73 publications

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“…This result is robust to a variety of sensitivity checks, such as alternative specifications and estimation techniques. Importantly, our empirical results contribute to a new strand of constitutional political economy literature that advocates for the use of disaggregated data, such as industry-level data of the current paper or firm-level data of Camyar and Ulupinar (2019).…”

Section: Discussionmentioning

confidence: 77%

“…4 Our work is also related to a small strand of literature that relies on more micro-level data. Camyar and Ulupinar (2019) found that firm performance is stronger under proportional systems, while Zuazu (2019) found evidence that the growth effect of democracy depends on the technology level.…”

Section: Related Literature and Hypothesesmentioning

confidence: 99%

“…2 Camyar and Ulupinar (2019) suggests that existing research on the economic impact of electoral systems exclusively focuses on economic policy without considering economic outcomes and, thus, it falls short of establishing the economic relevance of electoral systems in practical terms. Camyar and Ulupinar (2019) argues that the current literature emphasizes on macroeconomic outcomes without paying attention to the potential microeconomic outcomes and heterogeneous effects of constitutions. Looking at the aggregate economic effect of electoral rules might hide dynamics and within-country patterns that can solely be uncovered using disaggregated data.…”

Section: Introductionmentioning

confidence: 99%

“…Looking at the aggregate economic effect of electoral rules might hide dynamics and within-country patterns that can solely be uncovered using disaggregated data. Focusing on macroeconomic outcome variables runs the risk of the so-called ecological fallacy due to the aggregation problem, an issue that is gaining momentum in the political economy literature (Aghion et al, 2007;Stockemer and Sundström, 2016;Camyar and Ulupinar, 2019;Zuazu, 2019). Our paper adds to the constitutional political economy literature by studying industrial growth rather than industrial policies.…”

Section: Introductionmentioning

confidence: 99%

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The impact of electoral rules on manufacturing industries: evidence of disaggregated data of 61 industries of 55 countries

Yeung

Zuazu

2020

Const Polit Econ

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Electoral rules are found to induce different incentives to politicians and have an effect on the economic performance of countries. The literature is however silent on whether this effect is homogeneous across industries within a country. This paper argues with an analytical model that an incumbent government under majoritarian rules tends favour larger industries so as to secure votes from the employees and relatives of those industries. By constructing and exploiting an original dataset that covers disaggregated data on output growth of 61 industries in 55 countries, we find that larger industries in terms of employment size grow slower than smaller ones under nonmajoritarian electoral rules, but such a correlation is absent under majoritarian rule. This result is robust across different regression models and could well be explained by favouritism of governments towards larger industries.

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Section: Discussionmentioning

confidence: 77%

Section: Related Literature and Hypothesesmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%