Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/109098
Authors: 
Moricz, Sara
Sjöholm, Fredrik
Year of Publication: 
2014
Series/Report no.: 
IFN Working Paper 1023
Abstract: 
Does democracy increase economic growth? Previous literature tends to find a positive effect but does also suffer from possible endogeneity problems: democratization is typically not random and might be affected by factors that also have an impact on economic growth. This paper narrows down the question to empirically estimating the causal effect of local elections on local economic growth in Indonesia by using a quasi-experimental research method. The first direct elections of district leaders in Indonesia were performed in a staggered manner, and decided such that the year of election is exogenous. Thus, growth in districts that have had their first elections of district heads can be compared with growth in districts that have not had a direct election, which more specifically is performed by using a difference-in-difference approach. Our estimations show no general effect of local elections on economic growth. The result is robust to various robustness tests and is supported by data that show small effects of elections on governance.
Subjects: 
Democracy
Elections
Growth
Indonesia
Natural experiment
JEL: 
H11
O10
O43
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.