The broadly held view that promarket reforms are good for most people is in conflict with the equally broadly held view that, in democracies, reforms will generate widespread resistance. Resistance is expected because reforms typically produce economic downturns, at least over the short term. Under normal circumstances, we expect citizens to withdraw support from governments during periods of economic decline. If citizens withdraw support, then governments, worried about the next election, may abandon reforms. But our expectations should be different of new democracies pursuing promarket reforms. Citizens may believe governments when they claim that things have to get worse before they get better or that economic stagnation is the fault of the past model. Research in Poland, Peru, and Mexico, reported here, supports these expectations. Hence under democracy there is more scope for support of painful reforms than frequently ackenowledged.
ASJC Scopus subject areas
- Economics and Econometrics