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Constitutional Political Economy

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01.03.2009 | Original Paper

Do authoritarian institutions mobilize economic cooperation?

verfasst von: Abel Escribà-Folch

Erschienen in: Constitutional Political Economy | Ausgabe 1/2009

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Abstract

This paper explores the effect of dictatorial institutions on revenue composition. The higher the degree of institutionalization of the regime, the higher the perceived levels of legitimacy, efficiency and credibility, so taxes that require cooperation and compliance can be more effectively collected from the population. Institutionalized regimes thus make sense if non-tax revenue sources are scarce so limited representation must be granted in exchange of economic support. Our selection-corrected results show that more institutionalized regimes are able to collect more taxes on income, profits and capital gains, taxes on goods and services, taxes on property and payroll taxes.

Vorheriger Artikel From scholarly idea to budgetary institution: the emergence of cost-benefit analysis

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Fines and administrative fees are included in the non-tax revenue category; see below the definitions of the variables.

Or “quasy-voluntary compliance” in Levi’s (1988) terms.

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Namely, j = 0 for non-institutionalized dictatorships, j = 1 for regimes with a single institution, and j = 2 for fully institutionalized regimes.

Concretely, that ε and υ are jointly normally distributed.

See footnote 12.

We use both multinomial as well as ordered logistic regressions.

See the appendix for a description of the data used throughout this paper.

Hence, we agree with Fauvelle-Aymar (1999) in considering essential for the full understanding of revenue policy, especially among developing countries, the inclusion of non-tax revenues.

We follow the classification of regimes developed by Przeworski et al. (2000), which has been recently updated.

The correlation between the percentage of revenue levied from taxes on international trade and taxes on incomes and profits is −0.15.

It is 0.40 for the whole sample.

We have run Breusch-Pagan tests to check for dependent equations.

The tables containing the selection-corrected coefficients for the revenue components of the two models (SUR and panel corrected standard errors) are not reported but are available from the author.

The sign of the difference should be interpreted as follows: “No inst. vs. single inst.” means that the average of second institutional setting is subtracted to the average of the first, so a negative difference shows that the average of the second, “single inst.” in this example, is bigger.

The data are taken from Penn World Tables 5.6 and cover the period from 1950 to 2000.

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Titel: Do authoritarian institutions mobilize economic cooperation?
verfasst von: Abel Escribà-Folch
Publikationsdatum: 01.03.2009
Verlag: Springer US
Erschienen in: Constitutional Political Economy / Ausgabe 1/2009
Print ISSN: 1043-4062
Elektronische ISSN: 1572-9966
DOI: https://doi.org/10.1007/s10602-008-9052-6

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