Party system institutionalization and government formation in new democracies

Party systems provide the essential structure of the coalition bargaining environment. Stability in party systems ensures that there are regularities that can be observed in government formation, but most empirical research focuses on established democracies. In new democracies party systems are less institutionalized and interactions between parties are less predictable. This has significant implications for coalition formation. This paper presents the first study of coalition formation in new democracies that employs an empirical design that is comparable to the leading research on Western Europe. It uses a new dataset of potential coalitions in Central and Eastern Europe to examine three explanations for government formation that arise when party systems are weakly institutionalized. The results show that: first, incumbency is a disadvantage for governments when formation occurs post-election. This is due to high levels of electoral volatility in new democracies caused by policy failure and clientalistic practices. Incumbents are advantaged when formation takes place mid-term as weak party system institutionalization leads to an inchoate pattern of interaction between opposition parties which therefore fail to provide a viable alternative. Second, the presence of former dominant parties influences government formation by stifling the development of programmatic competition. Instead, programmatic competition is subjugated to contestation based on historical enmities. Finally, established parties collude to exclude new parties from coalition formation which may be an indicator that party systems are becoming more institutionalized. Overall, this article provides new insights into the importance of routinized and stable political practices and institutions.