Working Papers
Executive Constraints and Economic Growth. Working paper, 2024.
[ Abstract | Draft ]
Despite extensive research on the relationship between democracy and development, the features of democracy that are particularly important for this outcome remain unclear. Here, I unpack the democracy-growth link by examining the economic effects of two forms of executive constraints: horizontal constraints, the power of the parliament to control the executive, and vertical constraints, the capacity of citizens to keep rulers accountable through competitive elections. Using dynamic panel models, I demonstrate that each constraint influences growth through a specific mechanism. Horizontal constraints are strongly associated with greater private investment, whereas vertical constraints significantly improve living conditions through increasing education, health and public spending. Contrary to the conventional wisdom that horizontal constraints on rulers are the most important condition for growth, I show that vertical constraints are the driving force through which democracy improves economic development.