Replication data for: Interdependence in Comparative Politics: Substance, Theory, Empirics, Substance

In comparative political economy, for example, globalization and rising capital mobility imply tax competition that suggests the fiscal policies of one country must depend crucially upon those of other countries with which it competes for capital. This paper shows this theoretically and, more generally, how any situation involving externalities from one unit’s actions on others’ implies interdependence.

Positive/negative externalities induce negative/positive interdependence, which spurs competitive-races/free-riding, with corresponding early/late-mover advantages, and so strategic rush-to-act/delay-and-inaction. We show next how to model such interdependent processes empirically, that not doing so risks severe omitted-variable biases that erroneously favor domestic and exogenous-external accounts over interdependence but that doing so naïvely risks simultaneity biases with the opposite substantive implications.