IESET.
Hypotheses·institutional quality·market_reform_without_state_capacity_failure

Market-oriented reforms (trade liberalisation, privatisation, price decontrol) implemented in countries with weak state capacity (low WGI government effectiveness, low tax revenue as % of GDP, weak contract enforcement) fail to produce sustained long-run prosperity compared to similar reforms in high-capacity settings.

The claim is a boundary test: it protects against naive laissez-faire claims by requiring minimum state capacity as a precondition for market-reform success, over 1980-2020.

PARTIALengine/runs/market_reform_without_state_capacity_failure

PARTIAL — coef=-0.6889, p=0.24 (above α=0.1); direction inconclusive

confidence cueThe result is useful, but not decisive. Treat it as a clue, not a settled conclusion.

policy briefMixed or noisy

In ordinary language

In plain terms, this asks whether market reform episode is actually linked to better or worse real income per capita growth from 1980 to 2020.

plain answer

The evidence is suggestive but not decisive. coef=-0.6889, p=0.24 (above α=0.1); direction inconclusive

why it matters

This matters because institutional quality claims should change belief only when they survive a pre-declared empirical test.

how the test works

It compares 38 country or place units from 1980 to 2020, using a panel fe design, with fixed effects for country and year.

what was measured
What changed
  • Market reform episode
  • State capacity index
What we checked
  • Real income per capita growth
  • Productivity growth
what this does not prove

A single test is not the whole truth. It narrows the claim under a specific sample, time period, and method. Strong policy conclusions need the pattern to survive nearby tests, alternative data, and serious objections.

verification

3 input datasets, 0 unresolved missing series, provenance status: reproducible hash verified.

Results

engine/runs/market_reform_without_state_capacity_failure
1007550250198020002020BRAMEXARGCHLPERCOLVEN
illustrative sketch · run pending
No coefficients yet. When the model fires, this chart will show real_gdp_per_capita_growth across 38 sampled countries over 1980–2020.
The shapes above are stylised — none of the lines are real data.
Placeholder for market_reform_without_state_capacity_failure. Published chart will be generated from engine/runs/market_reform_without_state_capacity_failure/chart_data.json.

Who has skin in the game — schools predicting on this

5 schools list this hypothesis as a test of their position. The chips below are school-level scoreboard outcomes, not a second hypothesis verdict.

hypothesis verdict vs scoreboard outcome

The banner verdict judges this hypothesis as written. The scoreboard asks whether each school's polarity-corrected prediction was right. Raw status is not a school win: SUPPORTED supports schools that needed SUPPORTED, but refutes schools that needed REFUTED.

Classical Liberalwins if REFUTEDpartial/no-callStructuralist / Developmentalistwins if SUPPORTEDpartial/no-callEmpirical Pragmatist (the framework's house position)wins if SUPPORTEDpartial/no-callNew Institutional Economicswins if SUPPORTEDpartial/no-callSocial Democraticwins if SUPPORTEDpartial/no-call

Pre-registration

registration ordering unverified
first-spec commit 4c8ce8e · 2026-07-18T22:11:21Z
run generated · 2026-06-29T17:53:22Z
Run timestamp predates this path's first git-add commit (rebase, rename, or pre-git local run). Spec hash is still the path's first-add commit — not repository HEAD — but ordering is not a clean pre-registration proof.

Market-oriented reforms (trade liberalisation, privatisation, price decontrol) implemented in countries with weak state capacity (low WGI government effectiveness, low tax revenue as % of GDP, weak contract enforcement) fail to produce sustained long-run prosperity compared to similar reforms in high-capacity settings. The claim is a boundary test: it protects against naive laissez-faire claims by requiring minimum state capacity as a precondition for market-reform success, over 1980-2020.

Falsification criterion — what would disprove this

set before the run · honoured after

This hypothesis is considered falsified if:

The hypothesis is falsified if market reforms in low-capacity countries show positive and significant (p < 0.10) coefficients on GDP or TFP growth that are indistinguishable from reforms in high-capacity countries in an interaction specification. The claim requires a significant positive interaction between reform and state capacity.

formal test & threshold
test:      panel_fe_market_reform_state_capacity_interaction_1980_2020
threshold: [object Object]

Method

Template
panel_fe
Fixed effects
country, year
Clustering
country
Sample
38 countries · 1980 – 2020
Evidence type
associational

Data

VariableSourceTransform
real_gdp_per_capita_growth
outcome
world_bank_wdi:NY.GDP.PCAP.KD.ZGtier 2
level
tfp_growth
outcome
pwt:rtfpnatier 3
log_diff_5y
market_reform_episode
treatment
constructed:wacziarg_welch_trade_liberalisation; fraser_efw:summary_indextier 5
indicator
state_capacity_index
treatment
constructed:wgi_gov_effectiveness_plus_tax_revenuetier 5
level
log_gdp_per_capita_initial
control
world_bank_wdi:NY.GDP.PCAP.KDtier 2
log
human_capital_index
control
pwt:hctier 3
level
political_stability
control
wgi:PV.ESTtier 4
level
natural_resource_rents
control
world_bank_wdi:NY.GDP.TOTL.RT.ZStier 2
level

● ready  · ● pending  · ● reconstruct-needed

Detailed result card

Result card — market_reform_without_state_capacity_failure

Verdict: PARTIAL — coef=-0.6889, p=0.24 (above α=0.1); direction inconclusive

Pre-registration

  • Claim: Market-oriented reforms (trade liberalisation, privatisation, price decontrol) implemented in countries with weak state capacity (low WGI government effectiveness, low tax revenue as % of GDP, weak contract enforcement) fail to produce sustained long-run prosperity compared to similar reforms in high-capacity settings. The claim is a boundary test: it protects against naive laissez-faire claims by requiring minimum state capacity as a precondition for market-reform success, over 1980-2020.
  • Falsification rule: The hypothesis is falsified if market reforms in low-capacity countries show positive and significant (p < 0.10) coefficients on GDP or TFP growth that are indistinguishable from reforms in high-capacity countries in an interaction specification. The claim requires a significant positive interaction between reform and state capacity.
  • Falsification test: panel_fe_market_reform_state_capacity_interaction_1980_2020

Estimate

  • Method: linearmodels.PanelOLS
  • Coefficient (treatment): -0.6889
  • Std error: 0.5858
  • p-value: 0.24
  • Observations: 570, countries: 30
  • Within R²: -0.0426
  • Fixed effects: entity=True, time=True
  • Clustering: country

Variables resolved

  • world_bank_wdi:NY.GDP.PCAP.KD.ZG → real_gdp_per_capita_growth (outcome, publisher=world_bank_wdi, n=13897)
  • pwt:rtfpna → tfp_growth (outcome, publisher=pwt, n=6407)
  • constructed:wacziarg_welch_trade_liberalisation; fraser_efw:summary_index → market_reform_episode (treatment, publisher=fraser_efw, n=4557)
  • world_bank_wdi:NY.GDP.PCAP.KD → log_gdp_per_capita_initial (controls, publisher=world_bank_wdi, n=12104)
  • pwt:hc → human_capital_index (controls, publisher=pwt, n=8637)
  • wgi:PV.EST → political_stability (controls, publisher=wgi, n=5255)
  • world_bank_wdi:NY.GDP.TOTL.RT.ZS → natural_resource_rents (controls, publisher=world_bank_wdi, n=11504)

Variables missing data

  • constructed:wgi_gov_effectiveness_plus_tax_revenue (treatment, name=state_capacity_index) — vintage not on disk

Generated by scripts/run_panel_fe.py at 2026-06-29T17:53:22+00:00

Strongest opposing argument

Every hypothesis ships with its charitable opposing argument. The framework earns credibility by handling objections at their strongest, not weakest.

Authored framework. Read the transparency note.