Constitutional monarchy and long-run economic growth : friends or foes?

Garoupa, Nuno (author), Spruk, Rok (author)

This article examines the long-run relationship between constitutional monarchy and economic growth using a panel of 37 countries from 1870 to 2018. Exploiting the staggered timing of regime transitions as a source of quasi-experimental variation, we reassess whether monarchies promote prosperity or merely survive because of it. The results suggest that pre-existing economic development, rather than monarchical institutions themselves, explains the persistence of constitutional monarchy. The apparent growth advantage of monarchies is concentrated among wealthier pre-war states, where fiscal capacity and institutional maturity sustained stability. In poorer settings, constitutional monarchies failed to generate lasting growth and were eventually replaced by republican regimes, which subsequently outperformed them. These findings imply that prosperity sustains monarchy, not the reverse, and that contemporary constitutional monarchies represent the historical survivors of economic success rather than its institutional cause.

• Language: English
• Keywords: democracy, monarchy, political economy, economic growth, constitutional monarchy, long-run growth, prosperity
• Work type: Article
• Typology: 1.01 - Original Scientific Article
• Organization: EF - School of Economics and Business
• Publication status: In print
• Publication version: Version of Record
• Year: 2025
• PID: 20.500.12556/RUL-179892
• UDC: 330.34
• ISSN on article: 0929-1261
• DOI: 10.1007/s10657-025-09859-7
• COBISS.SI-ID: 258819075
• Publication date in RUL: 26.02.2026

Record is a part of a journal

• Title: European journal of law and economics
• Publisher: Springer
• ISSN: 0929-1261
• COBISS.SI-ID: 35389185

Licences

• License: CC BY 4.0, Creative Commons Attribution 4.0 International
• Link: http://creativecommons.org/licenses/by/4.0/
• Description: This is the standard Creative Commons license that gives others maximum freedom to do what they want with the work as long as they credit the author.

Secondary language

• Language: Slovenian
• Keywords: demokracija, monarhija, politična ekonomija, ekonomska rast