Explaining Cross-National Varieties of Civil Society and Democracy: Empirical Findings Using V-Dem Dataset

• In Event: Comparative civil society research

Abstract

1. Introduction and research questions
This paper intends to identify factors that explain the density or size of civil society in different countries. Since Weisbrod (1975) explained why nonprofits exist in a market economy through the government failure theory, many studies have conducted empirical testing (see Lu (2020) for a recent survey). The government failure theory states that a government that supplies public goods based on the preferences of the median voter cannot accommodate demand heterogeneity, so nonprofits exist to satisfy the demand of other voters. Thus, based on this theory, the density of nonprofits increases with increasing demographic heterogeneity, such as income, race, and religion. Indeed, Matsunaga et al (2010), tested the government failure theory with cross-country data, and found that the size of nonprofits is larger in countries with greater religious diversity. Although many previous studies have conducted empirical analyses of theory explaining nonprofit density, the results have been inconsistent. One of the reasons for this is that results vary depending on the type of data. In addition, because of the difficulty of obtaining data, there are not many cross-country analysis results. Therefore, in this paper, we conduct an empirical analysis of these theories of nonprofits using the V-Dem data, a large panel data set on democracy in various countries. Our research questions are as follows: 1) What kind of factors are important to explain international varieties of civil society? 2) Are the factors different depending on the period, and depending on regions? 3) Is the government failure theory able to explain the cross-national differences in civil society?

2. The V-Dem dataset
We would like to shed light on cross-national varieties of civil society in relation to democracy using the country-level V-Dem dataset. V-Dem (Variety of Democracy) is published by the Swedish V-Dem Institute. This is a panel dataset of democracy, civil society, and related indicators, complete with over two centuries of time-series data from more than 100 countries. In this dataset, there are several indicators of civil society. We assume that these indicators represent the density or size of civil society and use them. For example, CSO participatory environment (the involvement of people in civil society organizations), and CSO structure (civil societies inevitably involve a mix of larger and smaller organizations). We also use several indicators from V-Dem as variables representing demand heterogeneity (power distributed by social group).

3. Empirical findings and contributions
The analysis was conducted using data for 115 countries, from 1992 to 2019. If a situation in which different social groups have equal political power can be regarded as the existence of demand heterogeneity, then our results support the theory of government failure. That is, the higher the heterogeneity of demand, the more frequently they participate in CSOs or the more CSOs there are. Since few empirical studies using cross-country data existed after Matsunaga et al (2010), and most empirical studies used regional data within the U.S., this paper brings new analytical results on the government failure theory with cross-country panel dataset.

References

Lu, Jiahuan (2020), Does population heterogeneity really matter to nonprofit sector size? Revisiting Weisbrod’s demand heterogeneity hypothesis, Voluntas, 31: 1077-1092.
Matsunaga, Yoshiho and Naoto Yamauchi, Is the government failure theory still relevant? A panel
analysis using US state level data, Annals of Public and Cooperative Economics, vol. 75, no. 2,
2004, pp.227-263.
Matsunaga, Yoshiho, Naoto Yamauchi, Naoko Okuyama, What Determines the Size of the Nonprofit Sector?: A Cross-Country Analysis of the Government Failure Theory, Voluntas (2010) 21:180–201.
Weisbrod, B. A., Toward a theory of the voluntary non-profit sector in a three sector economy. In E. S. Phelps (ed.), Altruism, morality and economic theory (1975) 71–296. New York: Russell Sage Foundation.

Authors

• Naoto Yamauchi, JIPPS, Japan Institute for Public Policy Studies

• Akinobu Ogawa, Niigata University