Description statistics for new democracies countries

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Table 2. Description statistics for new democracies (countries where Freedom House index of political right improved by at least 1.5 points from 1972-75 to 1999-2002) Countries ALL NEW DEMO- CRACIES (62) NEW DEMO- CRACIES- TRANSITI ON COUNTRI ES (20) NEW DEMO- CRACIES- DEVELO- PING CO- UNTRIES (42) ALL EXCEPT NEW DE- MOCRACI ES (148) ALL COUN TRIES (210) Improvement of the index of political rights from 1972-75 to 1999-2002 3,31 3,98 3,00 -0,20 0,98 ICRG risk rating, 2000 65,104 66,017 64,591 68,918 67,417 Ratio of investment climate to increase of democracy index, % 9,013 8,279 9,425 20,184 15,786 PPP GDP per capita in 1999 5510 6900 4885 9588 8059 Increase in life expectancy from 1970-75 to 1995-2000 5,749 1,958 7,550 7,022 6,574 Annual average growth of GDP per capita in 1975-99 0,818 0,296 0,876 1,410 1,225 Index of government effectiveness in 2001 -0,193 -0,162 -0,210 0,088542 -0,007 Unofficial economy, 1 st estimate 35,1 28,2 40,5 21,8 28,2 Unofficial economy, 2 nd estimate 33,6 24,8 40,4 23,3 28,3 Share of central government revenues in GDP in 1995-99 as a % of 1971-75 132 56 136 164,9652 154 Average annual budget deficit, 1975-99, % of GDP -4,49 -3,26 -5,01 -3,94308 -4,13 Average annual inflation, 1975-99, % 30,3 16,6 31,1 13,23991 18,8 Average FOREX, months of imports, 1970-99 3,12 2,62 3,35 3,358422 3,27 Increase in FOREX, months of imports, from 1980 to 1999 1,53 3,14 0,81 0,446896 0,84 Ratio of prices of energy to prices of clothing in 1993, % (US=107%) 101,0 48,9 145,1 117,619 110,9 Source: World Bank, 2001; World Development Institute (WDI, 2001); Freedom House; UNDP (2002); Friedman, Johnson, Kaufmann, Zoido-Lobaton (1999). rights, so liberal authoritarian regimes like Hong Kong (before and after the handover to China) get very high scores. Another measure is the rule of law index (WDI, 2001; Kaufmann, Daniel, Kraay, 15
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Aart, and Zoido-Lobatón Pablo, 1999) that is based on polls of experts and surveys of residents (changes from –2.5 to +2.5, the higher, the stronger the rule of law). This latter database contains separate indices for the transparency and accountability, political stability, rule of law, control of corruption, government effectiveness and quality of regulations. Table 2 presents descriptive statistics for “new democracies” – transition and developing countries separately – as compared to all other countries. The unconditional results – uncontrolled for other factors, such as the level of development, etc. – are quite similar for new democracies in post- communist and in developing countries. The growth of GDP per capita in 1975-99 is slower than in other countries, the increase in government revenues is less pronounced, the index of government effectiveness is lower, and the shadow economy is larger. In addition, new democracies seem to run higher budget deficits (developing countries), have higher inflation, lower level of foreign exchange reserves and slower rates of accumulation of these reserves (developing countries), lower level of energy prices (developing countries). Only increases in life expectancy in new democracies in developing countries in 1970-2000 are larger (7.6 years) than elsewhere (7.0 years), but in multiple regressions (controlling for rule of law and for initial level of life expectancy in early 1970s) both the level of democracy and the increase in democratization in the last three decades negatively affect life expectancy. The closer scrutiny follows.
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