New tools and new tests in comparative strongpolitical economystrong The.pdf

New tools and new tests in comparative political economy: The Database of Political Institutions Thorsten Beck, George Clarke, Alberto Groff, Philip Keefer, and Patrick Walsh Beck, Clarke, Keefer and Walsh: Development Research Group, The World Bank. Groff: Federal Department of Foreign Affairs (Switzerland). This paper’s findings, interpretations, and conclusions are entirely those of the authors and do not necessarily represent the views of the Federal Department of Foreign Affairs, or the World Bank, its Executive Directors, or the countries they represent. Abstract: This paper introduces a large new cross-country database of political institutions, the Database on Political Institutions (DPI). It covers 177 countries over 21 years, 1975 – 1995. The paper explores the range of issues for which this data should prove invaluable, summarizes key variables, many of them new, and compares this data set to others. Among the novel variables we introduce are several measures of checks and balances, tenure, and stability; identification of party affiliation with government or opposition; and fragmentation of opposition and government parties in legislatures. We illustrate the application of DPI variables to several problems in political economy. Stepan and Skach find that democracy is more likely to survive under parliamentary governments; we find this result is not robust to the use of different variables from DPI, raising puzzles for future research. Similarly, Roubini and Sachs find that divided governments in the OECD run higher budget deficits following fiscal shocks. Replication of their work using indicators of divided government from the DPI indicates otherwise, again suggesting issues for future research. 2 Introduction The investigation of the ins