nep-pol New Economics Papers
on Positive Political Economics
Issue of 2007‒02‒03
six papers chosen by
Eugene Beaulieu
University of Calgary

  1. Does membership on the UN Security Council influence IMF decisions? Evidence from panel data By Axel Dreher; Jan-Egbert Sturm; James Raymond Vreeland
  2. Institutions, Infrastructure and Trade By Francois, Joseph; Manchin, Miriam
  3. When Is a Central Bank Governor Fired? Evidence Based on a New Data Set By Axel Dreher; Jakob de Haan; Jan-Egbert Sturm
  4. De la manipulation des elections indirectes By Sebastian Bervoets (CODE – U. Barcelona); Vincent Merlin (CREM - CNRS)
  5. The impact of political leaders’ profession and education on reforms By Axel Dreher; Michael J. Lamla; Sarah M. Rupprecht; Frank Somogyi
  6. The First Universal Suffrage Election, at County (Gewog) Level, in Bhutan By Ura, Karma

  1. By: Axel Dreher (Department of Management, Technology, and Economics, ETH Zurich); Jan-Egbert Sturm (Department of Management, Technology, and Economics, ETH Zurich); James Raymond Vreeland (Yale University, Department of Political Science, USA)
    Abstract: We investigate whether temporary members of the UN Security Council receive favorable treatment from the IMF, using panel data for 191 countries over the period 1951 to 2004. Our results indicate a robust positive relationship between temporary UN Security Council membership and participation in IMF programs, even after accounting for economic and political factors, as well as regional and country effects, and duration dependence. There is also evidence that UNSC membership reduces the number of conditions included in IMF programs. The size of the loan, however, is not affected by UNSC membership.
    Keywords: IMF, UN Security Council, Voting, Aid
    JEL: E5
    Date: 2006–09
  2. By: Francois, Joseph; Manchin, Miriam
    Abstract: We work with a panel of bilateral trade flows from 1988 to 2002, exploring the influence of infrastructure, institutional quality, colonial and geographic context, and trade preferences on the pattern of bilateral trade. We are interested in threshold effects, and so emphasize those cases where bilateral country pairs do not actually trade. We depart from the institutions and infrastructure literature in this respect, using selection-based gravity modeling of trade flows. We also depart from this literature by mixing principal components (to condense our institutional and infrastructure measures) with a focus on deviations from expected values for given income cohorts to control for multicollinearity. Infrastructure, and institutional quality, are significant determinants not only of export levels, but also of the likelihood exports will take place at all. Our results support the notion that export performance, and the propensity to take part in the trading system at all, depends on institutional quality and access to well developed transport and communications infrastructure. Indeed, this dependence is far more important, empirically, than variations in tariffs in explaining sample variations in North-South trade. This implies that policy emphasis on developing country market access, instead of support for trade facilitation, may be misplaced.
    Keywords: exports; gravity model; infrastructure; institutions; trade; zero-trade
    JEL: F10 F15
    Date: 2007–01
  3. By: Axel Dreher (Department of Management, Technology, and Economics, ETH Zurich); Jakob de Haan (University of Groningen, The Netherlands and CESifo, Munich, Germany); Jan-Egbert Sturm (Department of Management, Technology, and Economics, ETH Zurich)
    Abstract: This paper uses a new data set on the term in office of central bank governors in 137 countries covering the period 1970-2004 to estimate a model for the chance that a central bank governor is replaced. We formulate a number of hypotheses based on the literature on the determinants of central bank independence that are tested using conditional logit models and the Extreme Bounds Analysis. We conclude that, apart from the share of the current term in office elapsed, high levels of political and regime instability, the occurrence of elections, and high inflation increase the probability of a turnover.
    Keywords: central bank governors, central bank independence
    JEL: E5
    Date: 2006–07
  4. By: Sebastian Bervoets (CODE – U. Barcelona); Vincent Merlin (CREM - CNRS)
    Abstract: This paper is devoted to the analysis of two tiers voting rules. First, one candidate is elected in every jurisdiction and next, an aggregation procedure collects the results from the jurisdictions in order to designate the final winner. It appears that whenever individuals are allowed to change jurisdiction when casting their ballot, it is possible that they can manipulate the result of the election, except when the voting rule is the Priority rule, which assigns a priority order to the candidates.
    JEL: D71 D72
    Date: 2007
  5. By: Axel Dreher (Department of Management, Technology, and Economics, ETH Zurich); Michael J. Lamla (Department of Management, Technology, and Economics, ETH Zurich); Sarah M. Rupprecht (Department of Management, Technology, and Economics, ETH Zurich); Frank Somogyi (Department of Management, Technology, and Economics, ETH Zurich)
    Abstract: This paper analyzes whether the educational and professional background of a head of government matters for the implementation of market-liberalizing reforms. Employing panel data over the period 1970-2002, we present empirical evidence based on a novel data set covering profession and education of more than 500 political leaders from 73 countries. Our results show that entrepreneurs, professional scientists, and trained economists are significantly more reform oriented. Contrary, union executives tend to impede reforms. We also highlight interactions between profession and education with time in office and the political leaning of the ruling party.
    Keywords: Reforms, Economic Policy, Economic Freedom, Interest Groups, Lobbying
    JEL: D72 E61 H11
    Date: 2006–09
  6. By: Ura, Karma
    Abstract: Following a Royal Edict to adopt universal suffrage in election for local government institutions, maiden elections were held in 199 gewogs (counties) in Bhutan in 2002 to elect their chief executives. This paper gives an account of this first time event in a country where most villagers had never seen secret ballots and poll booths. It synthesizes detailed data, mostly qualitative, collected soon after the election was over, and assesses aspects of electoral participation that His Majesty the King of Bhutan has introduced steadily to deepen democracy. Beginning with a glance at the territorial organization of the Bhutanese state within which the counties are embedded, the paper compares the electoral results with the relevant election rules.
    Keywords: Voter turnout, Candidate criterion and attributes, Nominations, Elections, Local government, Politics, Democracy, Bhutan
    JEL: F15 O14 O30
    Date: 2006–10

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