Jain, Sanjay, Majumdar, Sumon and Mukand, Sharun W. (2011) Walk the line : conflict, state capacity and the political dynamics of reform. Working Paper. Queen's University, Economics Department, Kingston, Ontario, Canada. (Unpublished)

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Abstract

This paper develops a dynamic framework to analyze the political sustainability of economic reforms in developing countries. First, we demonstrate that economic reforms that are proceeding successfully may run into a political impasse, with the reform’s initial success having a negative impact on its political sustainability. Second, we demonstrate that greater state capacity to make compensatory transfers to those adversely affected by reform, need not always help the political sustainability of reform, but can also hinder it. Finally, we argue that in ethnically divided societies, economic reform may be completed not despite ethnic conflict, but because of it.

Item Type:	Working or Discussion Paper (Working Paper)
Subjects:	H Social Sciences > HB Economic Theory J Political Science > JC Political theory
Divisions:	Faculty of Social Sciences > Economics
Series Name:	QED Working Papers
Publisher:	Queen's University, Economics Department
Place of Publication:	Kingston, Ontario, Canada
Date:	2011
Number:	No.1288
Status:	Not Peer Reviewed
Publication Status:	Unpublished
Access rights to Published version:	Open Access
Funder:	Social Sciences and Humanities Research Council of Canada
URI:	http://wrap.warwick.ac.uk/id/eprint/45533

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