Replication Data for: The Fiscal Roots of Financial Underdevelopment

Why do some countries indulge in financial repression, harming economic development in the process, whilst others promote financial development? Three main explanations have been put forth. Market failures, due to information asymmetries, mean that credit is rationed even when lenders could potentially benefit from making loans readily available. Political failures, due to state capture, mean that credit will be rationed as a way of generating rents for politically powerful financial incumbents. The state might have its own fiscal reasons for politicizing the supply and price of credit, since financial repression provides easy-to-collect revenues. I draw on the third approach to argue that the state's fiscal imperative is usually the primary reason behind financial repression, and even when private actors benefit they are subordinate to this concern. A dynamic panel analysis that exploits instrumental variables and a case study of Mexico adduce strong empirical support for my fiscal transaction cost theory

Dealing with Dictators: Negotiated Democratization and the Fate of Outgoing Autocrats

This paper examines how the circumstances of democratic transition affect the consequences of losing office for outgoing dictators. Using data on constitutional origins and democratization from 1875 to 2004, we find that outgoing dictators who are able to impose a holdover constitution during democratization and beyond are less likely to face severe punishment upon relinquishing their rule. These results hold after accounting for alternative explanations of autocrats' post-tenure fate and after using instrumental variables to adjust for potential endogeneity. We also document several mechanisms by which this occurs: proportional representation, the election of right-wing executives, post-transition military influence, and elite control over local politics. The findings suggest that for dictators who fear their ousting in the face of domestic unrest or potential instability, democracy can provide a plausible avenue for protecting their most basic interests