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Multi-polarity and Institutional Development

Multi-polarity and Institutional Development. A Cross-National Analysis. Knowledge. Weak institutions and states pose a threat to the livelihood of billions of people and to international security.

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Multi-polarity and Institutional Development

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  1. Multi-polarity and Institutional Development A Cross-National Analysis Pablo Alonso

  2. Knowledge • Weak institutions and states pose a threat to the livelihood of billions of people and to international security. • Despite of the US$ billions spent on public sector transformation in LDCs results are not encouraging. • Our understanding of how institutions arise and change is limited. Pablo Alonso

  3. Distance from the Equator (and other factors) > Initial Distribution of Power (Multi-polarity) > Long-run Distribution of Power (Multi-polarity) > Long-run Level of Political Competition > Current Level of Institutional Development Hypothesis Institutional development depends on the patterns of power distribution among players via their effect on the level of effective political competition Pablo Alonso

  4. Empirical Strategy • Focus on the main relationship (Institutional development and Multi-polarity) • Report OLS for relationship using 5 indicators for DV and 2 indicators for IV • Control for heterocedasticity • Isolate relationship going from ID to DV using 2SLS IV regression method • Control for other potential explanations • Apply a series of Over-identification tests to see if the results are robust Pablo Alonso

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  13. Results • Multi-polarity is positively and significantly related to the five measures of Institutional Development • Relationship remains significant after controlling for potential explanations • Results are robust after testing for the assumption that the Instrumental Variable is not related to the DV Pablo Alonso

  14. Conclusion • The relationship going from Multi-polarity to institutions is positive, statistically significant and robust Pablo Alonso

  15. Policy Implications • Existing approaches that assume that institutions are exogenous to circumstances should be revisited • “Rules of the Game” vs. “Strength of the Players” • Focus should move from a “design” approach to a “power rebalancing’ approach Pablo Alonso

  16. Research Implications • Study and identify determinants of patterns of power distribution • Identify those (and their corresponding instruments) that can be manipulated in the short to medium term to accelerate change and break the “path-dependence” inertia • Study effects of political competition (or lack thereof) on “micro” institutional outcomes Pablo Alonso

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