Economic liberalization and political moderation

Abstract

Although economic liberalization has been argued to promote political liberalization, this relationship is poorly understood and we do not consistently observe greater economic openness leading to more open and moderate political systems. We examine the connection between liberalization and moderation in the context of Islamist and Communist parties, both of which are characterized by ideologies opposed to democracy and the market. When will these ideological parties moderate by adopting more pragmatic agendas? We argue that competitive liberalization spurs the emergence of more moderate parties, but crony liberalization does not. In support of this, we use two sets of most different case comparisons in which we compare two instances of competitive liberalization (Turkey and Hungary) and two instances of crony liberalization (Egypt and Bulgaria). Our research offers an important clarification to existing explanations and a more generalizable theory of how and why liberalization is linked to political moderation.