The uneasy relationship between party system institutionalization, democracy, and liberalism

On the one hand, previous research provides grounds to expect a positive association between party system institutionalization and democracy. The former is supposed to reduce the scope of populist leaders, and to promote accountability (Birch, Reference Birch2003; Schleiter and Voznaya, Reference Schleiter and Voznaya2018), governability (Diamond and Linz, Reference Diamond, Linz, Diamond, Hartlyn, Linz and Lipset1989; Mainwaring et al., Reference Mainwaring, O'Donnell, Valenzuela, Mainwaring, O'Donnell and Valenzuela1992; Innes, Reference Innes2002; Zielinski et al., Reference Zielinski, Slomczynski and Shabad2005; Thames and Robbins, Reference Thames and Robbins2007), programmatic representation (Mainwaring and Torcal, Reference Mainwaring, Torcal, Katz and Crotty2006), and legitimacy (Mainwaring and Scully, Reference Mainwaring and Scully1995; Diamond, Reference Diamond, Diamond, Platter, Chu and Dien1997: xxiii). On a more general level, low institutionalization can prevent both parties as well as voters from engaging in strategically driven coordination (Mainwaring and Zoco, Reference Mainwaring and Zoco2007), intensifying problems of collective action in relation to preference aggregation.

In party systems that follow no established patterns of behavior and produce ad hoc governments, it could be the case that patronage is the only factor that keeps coalitions together (Lewis, Reference Lewis2006; O'Dwyer, Reference O'Dwyer2006). The governments of inchoate party systems tend to be short-lived (Powell, Reference Powell1982; Müller-Rommel et al., Reference Müller-Rommel, Fettelschoss and Harfst2004; Baylis, Reference Baylis2007; Savage, Reference Savage2016) and therefore the policymaking process can be of low quality. An enduring set of actors and institutional continuity is a prerequisite for successful economic and administrative reforms (Dimitrov et al., Reference Dimitrov, Goetz and Wollmann2006; Tommasi, Reference Tommasi2006; O'Dwyer and Kovalcik, Reference O'Dwyer and Kovalcik2007). It is easier for political actors to determine which party suits them best in the case when governments are composed of a narrow range of parties, which have stable associations amongst each other. Under such circumstances voters are in a position to form a connection to specific political groups, which can extend into loyalty to the political system, further strengthening the latter's legitimacy and stability (Dalton and Weldon, Reference Dalton and Weldon2007).

Stability in the range of alternative governments provides political actors with a broader time span and makes democratic competition more predictable and thus is one of the fundamental reasons why the consolidation of party relations in government can improve democracy. The sources of continuity and predictability can be diverse, including institutional, cultural, demographic, etc., factors. While the literature tends to emphasize the close relationship between parties and specific social groups as the anchor of this stability (Pridham, Reference Pridham1990; Mainwaring and Scully, Reference Mainwaring and Scully1995; Morlino, Reference Morlino1998; Tavits, Reference Tavits2005; Casal Bértoa, Reference Casal Bértoa2017), the degree of closure is also a function of the internal norms of a country's party politics.

It is not uncommon that democratic erosion and failure takes place when a leader emerges, who gathers the reins of power and creates a gap between the demos and its democratic institutions (parties or parliaments). This is less likely in closed systems, where ambitious political entrepreneurs are incentivized to join existing forces, respect established institutions, advocate incremental changes, and remain within the boundaries of liberal, representative democracy (Lane and Ersson, Reference Lane and Ersson2007). It is easier to cultivate complex programmatic traditions and to lock in voters and politicians into such traditions if the roster of parties and the relations among parties is stable (Kitschelt et al., Reference Kitschelt, Hawkins, Luna, Rosas and Zechmeister2010). In the absence of such stability, political actors are more likely to resort to material incentives or charismatic appeal.

On the other hand, there are also arguments that cast doubt on the claim that party system institutionalization is an unconditional blessing. Scholars ranging from Ostrogorski (Reference Ostrogorski1902) to some of the very recent democratic theorists (cf. Saward, Reference Saward2001) have criticized democratic politics for being party-centered. Democracies that revolve around parties can easily turn into oligarchic systems of partial, bureaucratic, and elitist organizations, especially if other political agents like trade unions or mass movements are sidelined. This is especially the case if the range of governing parties is limited to old and established parties and if patterns of coalition formation do not adopt to changing circumstances.

Moreover, the danger that the state is captured by actors that have concentrated power is particularly high in closed systems (Meyer-Sahling and Veen, Reference Meyer-Sahling and Veen2012). Those in power have an incentive to warp the activities of the state to their benefit and as such constitute a threat to the rule of law and a political equality. To the extent that high closure results from an antagonistic relationship between two parties or two blocks of parties, it is less appropriate to speak of an oligarchy. But as far as the preconditions of a consolidated democracy are concerned, the situation may be even worse: the high polarization associated with such configurations is likely to undermine mutual respect, rational decision-making, and trust in the system.

In terms of the empirical co-variation of the various measures of democracy and of institutionalized party politics, most studies (e.g. Diamond and Linz, Reference Diamond, Linz, Diamond, Hartlyn, Linz and Lipset1989; Mainwaring and Scully, Reference Mainwaring and Scully1995; Morlino, Reference Morlino1998; Kuenzi and Lambright, Reference Kuenzi and Lambright2005; Tavits, Reference Tavits2005; Hicken, Reference Hicken2006; Lindberg, Reference Lindberg2007; Weghorst and Bernhard, Reference Weghorst and Bernhard2014; Casal Bértoa, Reference Casal Bértoa2017) point to a positive pattern, finding frequently changing party labels and unpredictable relations among parties in the least democratic systems. But quite a few studies (e.g. Schedler, Reference Schedler1995; Tóka, Reference Tóka1997; Stockton, Reference Stockton2001; Wallis, Reference Wallis2003; Basedau, Reference Basedau, Basedau, Erdmann and Mehler2007; Thames and Robbins, Reference Thames and Robbins2007) found evidence to the contrary, and even Mainwaring and Scully (Reference Mainwaring and Scully1995: 22) arrived to the qualified conclusion according to which the exact degree of party system institutionalization may be irrelevant above a certain threshold.

Party system closure has been conceptualized (Mair, Reference Mair1997) as a synthesis of three aspects of party relations in the governmental arena: high barriers in front of newcomers (‘access’), a deep divide between government and opposition parties, excluding the possibility that (some) opposition parties join (some of) the incumbents in government (‘alternation’), and the repetition of the familiar coalitions (‘formula’). There are reasons to suspect that these three components may not have a uniform relationship with the liberal dimension of democracy.

As far as access is concerned, the literature provides reasons to regard too much openness as dangerous for democracy. Easy access to government can open the doors of executive power to political outsiders and populist, irresponsible, and illiberal parties. High turnover can lead to a ‘carpe diem syndrome’: new parties may act according to their short-term particular interests and with little respect toward the law. In contrast, the restriction of the governments to a few, well-known players can help the voters to identify accountable parties and under the conditions of high-level electoral accountability parties may refrain from undermining the rule of law. Therefore, while the permanent exclusion of newcomers from government may ossify a political system, our hypothesis is that higher closure on access (i.e. small weight of new parties in governments) has a positive impact on the liberal dimension of democracy.

The second component of party system closure, alternation, is likely to point in the opposite direction. A party system has a high score on this dimension if elections are followed either by the endorsement of the ruling government, with each party remaining in power, or by wholesale alternation, when all parties are replaced. Arguably, party systems that follow this simple, transparent pattern of succession can be considered as more institutionalized or, using Mair's terminology, as closed. But while these configurations help closure, they may undermine liberal democracy. In the first instance, when the same parties dominate the executive, the incumbents develop a monopoly over governing and policymaking, opening the door for the abuse of power. In case of wholesale alternation, governments may be tempted to undo what the previous governments have enacted, weakening the predictability associated with the rule of law.

Wholesale alternation is most typical in contexts when governments composed of one or two parties have a comfortable majority in the legislatures. In such situations the governing parties may consider themselves legitimized to try to dominate the judiciary and to turn the parliament into a rubber stamp legislature, diminishing the control potential of opposition parties. In both cases, there is little incentive for self-limitation, for ‘reaching across the aisle’, and the majoritarian attitude may spill over easily into restrictions on counter-majoritarian institutions. Therefore, we expect that (higher closure on) alternation will have a negative impact on the liberal dimension of democracy.

Finally, the influence of formula (i.e. the frequent re-occurrence of familiar coalitions) may be complicated. On the one hand, when new coalition combinations emerge, there is more political bargaining going on, allowing minority interests to play a more prominent role. Furthermore, in innovative coalitions the partners are likely to share some ideological preferences but not others. As a result, they may need to look for compromise and to subject themselves to the legislature. The judiciary may be more independent, less under the influence of one particular party. Given their unstable composition, governments with innovative formulae will have more difficulties in passing big legislative (e.g. constitutional) reforms that could undermine legal and political traditions.

On the other hand, constant experimentation with new formulae may indicate a lack of consolidation of the democratic regime. In case a completely new party takes over the executive, previous agreements are less likely to be respected. Consequently, and given the heavy emphasis in the state-of-the-art on the importance of some regularity in the political landscape for democratic development, we hypothesize that (high closure on) formula will have a positive impact on the liberal dimension of democracy, acknowledging, however, the mechanisms that may point into the opposite direction.

In order to establish the unique contribution of the discussed phenomena to liberalism and democracy, we need to filter out the effects of potential confounding factors. Party systems tend to be high on closure when they are rich, old, characterized by low degree of electoral volatility, low level of polarization, and low fragmentation (Casal Bértoa and Enyedi, Reference Casal Bértoa and Enyedi2021). These conditions may be beneficial for high-quality democracy too, and therefore their contribution to liberalism and democracy must be isolated. As far as the impact of the regime type (presidentialism, semi-presidentialism, or parliamentary regime) is concerned, there is no consensus, but given the importance attributed in the literature to the constitutional framework, we add this factor to the list of control variables. We also control for time (the age of the party system) as democracy and especially the liberal dimension of democracy requires time to consolidate.

Because party system closure is measured through the composition of the governments, it primarily taps the stability of the configuration of parties and political elites and tells us less about electoral dynamics. Therefore, we expect closure to play a more significant causal role in shaping the liberal aspects of democracy than to influence its electoral components. In the subsequent analyses we include both generic measures of democracy and an index that specifically focuses on the liberal components in order to separate the two potential relationships.

Our investigation complements Casal Bértoa and Enyedi's analysis (Reference Casal Bértoa and Enyedi2021). In their book they found that the survival of democratic systems is conditioned on high degree of closure, but the association between the quality of democracy and closure depends on economic development: in rich societies they are positively related, in poorer countries there seems to be a negative association. In the current article we go beyond the overall index of closure and consider its individual components and their relations to the indexes of liberal democracy.

Measuring party system closure and liberal democracy

Dataset on party systems

Below we analyze 58 minimally democratic party systems (see Table 1) that existed between 1848 and 2021 in Europe. The original party system closure dataset (Casal Bértoa, Reference Casal Bértoa2022) contained more cases, but we had to leave out Andorra, San Marino, and Lichtenstein as they are not part of the V-Dem dataset, and we had to drop Armenia (1991–1994), the post-WWII party system in Greece (1946–1948), and the Yugoslav Kingdom (1921) as there is no available data on volatility for these cases.Footnote ³

Table 1. Party systems included in the analysis

^a Party systems still existing at the time of analysis.

While the utilized dataset is the largest in the field of party system institutionalization studies in terms of time-span and the number of systems included, it is limited to Europe.Footnote ⁴ At the same time, the dataset includes cases from both Eastern and Western Europe, and therefore contains considerable variation on many relevant political and economic dimensions. Additionally, the coalition politics that is in the focus of our analysis is particularly relevant for the multiparty systems typical of European states.

The units of analysis are party systems; the relevant indicators of closure and liberal democracy are averaged over the whole duration of a party system. Such a high degree of aggregation comes with a great deal of information loss, but it is necessary for two reasons. First, the very concept of party system carries the implication that the logic of party interactions has some resilient, system-specific characteristics. For example, the effective number of parties or the durability of governments is, to a large extent, determined by the institutional environment, most notably the electoral system (see Taagepera, Reference Taagepera2007), which tends to be stable over time. Second, the V-Dem indicators that are used in this paper to measure liberal democracy and its components change on average very little over time within party systems. The correlation between the liberal component at year t and t–1 is 0.95. Considering both party system features and the features of democracy, we see much more variation between systems than within systems. The alternative strategy of analyzing the yearly dataset as panel data, focusing on associations within party systems over time and employing some of the standard Time-series Cross-section (TSCS) methods (e.g. Beck and Katz, Reference Beck and Katz2011), would be problematic in this case given the lack of variation within systems (cf. Plümper and Troeger, Reference Plümper and Troeger2019).

Typically, one country is one party system, but in many instances (see Table 1), there was such a degree of discontinuity in party politics that we had to label the subsequent time-periods as separate party systems. In most cases the decision of where to draw the dividing line is unproblematic (like in the case of Latvia I and Latvia II, divided by 60 years of non-democratic rule) and few additional divisions in comparison to the ones that we have implemented seem justifiable. Nevertheless, we have ran several robustness checks. Most importantly, we reran the regressions taking the ruptures in 1994 in Italy, in 1977 in Belgium, in 1990 in Germany, in 1902 in France, in 2004 in Ukraine, in 1971 in Turkey, in 1917 in Spain, in 2001 in North Macedonia, and in 1909 in Greece as separating distinct party systems. This raised the number of cases from 58 to 67. The results remained essentially the same.

In the subsequent models we control for a host of potentially confounding factors: fragmentation, polarization, electoral volatility, the type of regime, the level of economic development, and the age of the party system. Fragmentation is measured through the effective number of parliamentary parties (Laakso and Taagepera, Reference Laakso and Taagepera1979), the standard measure of party system fragmentation. Polarization is captured through the proportion of electoral support for anti-political-establishment parties within the legislature.Footnote ⁵ As far as electoral volatility is concerned, we use the standard index proposed by Pedersen (Reference Pedersen1979). The type of regime is recorded on a binary scale where 0 indicates presidentialism or semi-presidentialism and 1 signifies parliamentarianism. For the level of economic development, we use the logarithm of per capita GDP from the Gapminder (2021) dataset. Finally, we also include the number of years from the start of the system until its end (or until the present moment) to control for the varying durations of party systems. Like the main variables of interest, the control variables (except age) are also averaged over the lifetime of a party system. Descriptive statistics of all variables included in the models are presented in Table 2.

Table 2. Descriptive statistics

Analysis and results

Figure 1 shows the statistically significant correlations between the components of closure and liberal democracy. Looking at bivariate relationships, liberalism and its components have a positive association with closure and its components, with the exception of alternation. At first sight, therefore, it seems that the empirical associations are in line with the optimistic expectations concerning the positive impact of party system institutionalization on the liberal dimension of democracy. Such bivariate associations, however, do not take into account other relevant characteristics of party systems and general socio-economic conditions, which are addressed by the OLS regression models in the following sections.

Figure 1. Correlations of the indices and sub-indices of closure and liberal democracy in Europe. Only coefficients significant at the 0.05 level are shown.

In order to make the different models and the effects of different variables comparable in the OLS regressions, we show standardized regression coefficients, which indicate change in standard deviations. Given the different trajectories of Eastern and Western European party systems, we tested models where the possible difference in the levels of liberal democracy between the two regions was taken into account (region dummy) and where possible differences in the effects for the closure indicators were modeled (interaction effects with region dummy), but the results did not change.

Even though the correlations between some of the predictors in the model were high (see Figure 1), multicollinearity was not a problem as all variance inflation factors were below 5 in the primary model.Footnote ⁶ No major influential outliers were present in the data, although whether some of the effects are significant at the 0.05 or the 0.1 level does depend on whether all cases are considered or some are left out (with such a low number of cases, this is expected). The results do not change if one excludes the cases that model diagnostics indicated as somewhat influential (Czechoslovakia, France I, Montenegro, Russia, Ukraine, Kosovo, Turkey III, Greece I, Malta) from the analysis. Finally, while analyses with a small number of cases have some obvious limitations, the advantage is that we can be relatively confident that the detected associations are valid, if they are robust to different model specifications and the range of cases included. As standard errors depend on sample size, the lower the number of cases, the stronger an association needs to be to turn up as statistically significant. See the online Appendix for more information about the models and tests that were described above.

Starting from the association between the composite index of closure and the overall index of liberal democracy, the results of the analysis are shown in Table 3. It is notable here that the positive association of party system closure with liberal democracy and its components, detected at the level of bivariate relations, is no longer observable.

Table 3. Relationship between closure and measures of democracy

Standardized coefficients.

Note: *P < 0.05; **P < 0.01; ***P < 0.001.

To the extent that closure is related to the various indices of democracy, the relationship is rather negative, reaching (0.05 level) statistical significance with the liberal component index (an aggregation of the rule of law, the judicial, and the legislative constraints indices).

Only some of the control variables have a clear influence on the various facets of democracy, but the impact of GDP and, to a smaller extent, the influence of the age of democracy appear to be beneficial, while the influence of electoral volatility is detrimental, in line with the expectations. Parliamentary fragmentation, somewhat surprisingly, seems to have a minor positive impact.

A somewhat different picture emerges if we disaggregate the closure index and test for associations between liberal democracy and its components, on one hand, and formula, access, and alternation, on the other hand (Table 4). None of the components of closure are related to the V-Dem's so-called liberal democracy index which blends indicators of electoral democracy and liberalism. This lack of association is due to a lack of covariation between closure and electoral democracy. However, if the specifically liberal dimension (the ‘liberal component’) and its sub-indices are considered, then both alternation and access have a statistically significant negative impact, undermining the rule of law, and weakening judicial constraints in case of high access (meaning low frequency of new parties included into the governments). The phenomenon that is often considered to be problematic from the point of party system institutionalization, the recombination of opposition and governmental parties into new alliances, seems to be advantageous when the rule of law is considered. The findings also suggest that the openness of governments to new parties is favorable to both rule of law and judicial constraints.

Table 4. Relationship between the components of closure and measures of democracy

Standardized coefficients.

Note: *P < 0.05; **P < 0.01; ***P < 0.001.

The clearest example of the pernicious interaction between closure and the rule of law is to be found in Georgia. In this country party system institutionalization can be said to be high. According to its closure index Georgia ranks above Western Europe in this regard. The configuration of party politics is close to a perfect two-party system model, dominated by the struggle between the United National Movement and Georgian Dream. The predictable system is underpinned by the institutional framework (a disproportional mixed electoral system) and by political culture, characterized by high degree of polarization. The very same factors together with the high degree of closure lead to executive aggrandizement and a lack of respect toward rule of law. Current day Germany, however, illustrates well the environment in which the regulations of freedoms and the independent, professional operation of the judiciary is encouraged by the overlap between the consecutive cabinets.

Formula, on the other hand, has a positive association to the rule of law component of liberalism in democracy once the negative effects of alternation and access have been accounted for. The Nordic countries illustrate particularly well the positive relationship between the stabilization of coalition alternatives and the robust respect of individual freedoms, checks and balances, and equality before the law. Formula is the only component of closure that behaves as the optimistic theories of party system institutionalization would predict: the familiar, predictable patterns of coalition-building between parties who have governed together before strengthen the rule of law, and thereby liberal democracy.

As far as the control variables are concerned, minor differences can be observed between the two sets of regressions. When the composite index of closure is used, the earlier noticed small positive influence of parliamentary fragmentation is no longer discernable and the negative impact of volatility appears only for the ‘liberal component’, the rule of law, and judicial constraints indices. The second set of regressions confirms that economic development improves all aspects of democracy, while polarization has no significant impact.

In line with the expectations, the frequent return to familiar coalition formulae is conducive to more robust liberal mechanisms, while the tendency toward no change in governments entails a deterioration in the quality of the liberal dimension of democracy, particularly as far as the rule of law is concerned.

The fact that formula and access have the opposite influence is surprising since there exists a mechanical relation between them: if a new party enters a coalition, the scores of both variables decrease. Accordingly, the association between formula and access is high in the present dataset – the correlation coefficient for their association is 0.82. The two components of closure diverge when parties that have already been in government form novel coalition combinations without co-opting new partners. It seems that this segment of non-overlap, that is, the frequent innovations in the coalition-making habits of established parties, a phenomenon particularly visible in countries like Cyprus, Romania, inter-war Estonia, or post-Gürsel's coup Turkey, creates an environment in which it becomes difficult to maintain robust rule of law mechanisms as well as judicial constraints on the executive.

While the positive effect of closed formula is in line with the expectations, the negative impact of closed access runs against the expectations of the literature. The conclusion must be that in the long run those systems do better that are open to newcomers – even if keeping challenger parties out of government may be occasionally beneficial, especially if these parties are of the illiberal sort.

High values of closure on the dimension of alternation, that is, the tendency of avoiding the governmental cooperation of incumbents and previously opposition parties, typical of dominant (e.g. Georgia, Hungary) or two-party systems (e.g. contemporary Greece and Spain), was expected to have a negative effect, and the results conform to these expectations. In the case of alternation one end of the spectrum, the ‘open’ end, is defined by the configuration when half of the government stays in office, and the other half is replaced. The opposite, ‘closed’, end is defined by two types of configurations: when there is total alternation or when there is no alternation. It is justified to ask the question whether both patterns have the same impact on liberal democracy. In order to find out we ran additional models using ministerial volatility (calculated the same way as electoral volatility) and separating the two aspects of closed alternation. These additional models showed that no change in government (as opposed to partial change) had a significantly negative impact, while wholesale alternation was unrelated to the composite liberal democracy index and to its components (see Appendix). These results make good sense, as the biased use of state power is much more likely if the same parties occupy office for a long period than when governments are regularly and completely replaced.