Publication

This paper quantifies the impact of incentives related to potential membership on institutional change as measured by the World Bank Governance Indicators (WBGI). Based on a panel of 25 transition countries for the period from 1996 to 2008, the authors show that pre-accession incentives provided by the EU and NATO clearly matter for institutional development. In addition, the authors find that path-dependency determined by cultural norms may be overcome by economic liberalization, while foreign aid seems to hamper institutional development.