When and why do national institutions change? Do national leaders matter? In the most recent episode of Talking Economics, Katarína Stehlíková and Sebastian Ottinger look back to European history, and from the perspective of political economy, discuss its relevance for institutional change in today’s China or Russia.
What we know in economics and in science more broadly is that national institutions, such as democracy, matter. What we know from history is that institutions can be very persistent. (…) Institutions can sometimes change very quickly and that usually happens alongside public protest. (…) And it must not often be a change for the better. We think we know some factors that can trigger institutional change – economic decline or a crisis, but also a political crisis. Looking at Russia – failed war could be something that would trigger institutional change due to public unrest at home.
We know that leaders matter. (…) Even just a few people can make a difference. Coming back to Russia, yes, maybe it’s only 10 people we need to actually drive to organizing change back in Russia. If we allow these people to stay with us and get exposure to our institutions, (…) we might have a higher chance to actually drive a change.”—Sebastian.
Sebastian Ottinger has been an Assistant Professor at CERGE-EI since September 2022. He is an Applied Microeconomist with research projects in the fields of Urban Economics and Political Economy, all drawing on European or American Economic History. He earned his Ph.D. from UCLA Anderson School of Management in 2021.