March 31, 2010

Contagious Capitalism

  • Peter Leeson

    Senior Fellow, F. A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics
  • Andrea Dean

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In their 2009 article in American Journal of Political Science, Leeson and Dean empirically examined the democratic domino theory and found that while democratic dominos fall as this theory contends, they fall significantly "lighter" than the theory’s importance and influence suggest. Using their approach, this paper asks whether capitalism is also contagious and, if it is, whether it spreads more strongly or weakly than democracy. We find that capitalism spreads more strongly than democracy but that its spread rate is similar. This similarity suggests that changes in underlying "meta-institutions," such as culture, may ultimately drive changes in both political and economic institutions and explains why political and economic dominoes fall with similar "heft."

Citation (Chicago Style)
Leeson, Peter, Russell Sobel, and Andrea Dean. "Contagious Capitalism." Working Paper, Mercatus Center at George Mason University, 2010.