Ukraine's Orange Revolution and Property Rights: Sovereign Commitment Reconsidered

Conventional wisdom suggests that credible commitment by the central executive – particularly through an empowered parliament – can have a profound impact on the security of property rights. This is the much-celebrated account of the Glorious Revolution in England in New Institutional Economics. I use Ukraine's 2004 Orange Revolution to re-examine this axiom. Three types of data are used: (1) records from my 64 semi-structured interviews with entrepreneurs and government officials in the region, in 2005-12; (2) a large-N survey of 120 enterprises from 5 regions, implemented in 2007; (3) analysis of the regional media. I find that despite the institutional constraints imposed on the presidency, the revolution did not enhance the security of property rights in Ukraine. I use process tracing to dissect the precise and wide-ranging nature of executive commitment, as well as the longitudinal BEEP survey data to show that – surprisingly – the security of property rights may have declined in the long run following parliamentary empowerment. I further argue that the breakdown of administrative accountability within the executive – a result of the revolution – was mainly responsible for the poor protection of property rights. While theories of credible commitment stress threats to property rights emanating from the elites, I show that expropriation is often carried out by unaccountable low-level bureaucrats.