1. Multi-polarity and Institutional Development
A Cross-National Analysis
Saturday, October 28th, 2005
Pablo Alonso

2. Knowledge
Weak institutions and states pose a threat to the livelihood of billions of people and to international security.
Despite of the US$ billions spent on public sector transformation in LDCs results are not encouraging.
Our understanding of how institutions arise and change is limited.
Saturday, October 28th, 2005
Pablo Alonso

3. Hypothesis
Institutional development depends on the patterns of power distribution among players via their effect on the level of effective political competition
Distance from the Equator (and other factors)
>
Initial
Distribution of Power
(Multi-polarity)
Long-run
Level of Political Competition
Current Level of Institutional Development
Saturday, October 28th, 2005
Pablo Alonso

4. Empirical Strategy
Focus on the main relationship (Institutional development and Multi-polarity)
Report OLS for relationship using 5 indicators for DV and 2 indicators for IV
Control for heterocedasticity
Isolate relationship going from ID to DV using 2SLS IV regression method
Control for other potential explanations
Apply a series of Over-identification tests to see if the results are robust
Saturday, October 28th, 2005
Pablo Alonso

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Pablo Alonso

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Pablo Alonso

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Pablo Alonso

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Pablo Alonso

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Pablo Alonso

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Pablo Alonso

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Pablo Alonso

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Pablo Alonso

13. Results
Multi-polarity is positively and significantly related to the five measures of Institutional Development
Relationship remains significant after controlling for potential explanations
Results are robust after testing for the assumption that the Instrumental Variable is not related to the DV
Saturday, October 28th, 2005
Pablo Alonso

14. Conclusion
The relationship going from Multi-polarity to institutions is positive, statistically significant and robust
Saturday, October 28th, 2005
Pablo Alonso

15. Policy Implications
Existing approaches that assume that institutions are exogenous to circumstances should be revisited
“Rules of the Game” vs. “Strength of the Players”
Focus should move from a “design” approach to a “power rebalancing’ approach
Saturday, October 28th, 2005
Pablo Alonso

16. Research Implications
Study and identify determinants of patterns of power distribution
Identify those (and their corresponding instruments) that can be manipulated in the short to medium term to accelerate change and break the “path-dependence” inertia
Study effects of political competition (or lack thereof) on “micro” institutional outcomes
Saturday, October 28th, 2005
Pablo Alonso