Reform insulation rises with blocking thresholds and falls with aggregate uncertainty

Evidence

Insulation is decreasing in A and increasing in l. In order to gain intuition about these last two results it is useful to study the ex ante probability that the policy reform passes (i.e. the probability that the fraction of individuals below the threshold is less than M). — Philippe Aghion, Alberto Alesina, and Francesco Trebbi, Endogenous Political Institutions, 76

Categorization

• DEFINE: Defines the implementation probability of a reform as the ex ante chance the blocking threshold is not met.