The Impact of Direct Democracy on Society - Universität St.Gallen

– 93 –dichotomous variable indicating whether an individual pays church taxes or not. Fortunately,the SHP data are richer and allow controlling for several individual religious pr<strong>of</strong>essions.Following the HENDRY approach, we start with the comprehensive model, for both <strong>of</strong> whosedatasets ordered probit estimates are given in table A.2 <strong>of</strong> the Appendix. 113 For the SHP data,we show the results for both the balanced and unbalanced panel. 114 For the LEU dataset, wepresent the results <strong>of</strong> weighted estimates that take into account the oversampling, as well asestimates for the reduced representative sample. In all four cases, the squared income variablefor those below the poverty line does not prove significant. <strong>The</strong>refore, this variable is deletedfrom further estimations. In all four estimations the variables controlling for religiousdenominations are either not significant at all or only very weakly at the 10% level <strong>of</strong>significance 115 . For this reason, these cultural factors are excluded from the discussion <strong>of</strong> theestimation results. Moreover, the discussion <strong>of</strong> results is also restricted to the balanced paneland the full LEU dataset.Table 1a shows the results <strong>of</strong> the models with the SHP data. 116 If no cultural variables areincluded, the index <strong>of</strong> direct popular rights has a significant positive impact as in the models<strong>of</strong> FREY and STUTZER. However, as soon as any cultural variables are taken into account, thesignificance vanishes completely: the corresponding t-statistics are very far from anyconventional significance level. Thus, the significance in model (1) seems to be only a result<strong>of</strong> the omitted cultural variables.It is hardly surprising that the effect <strong>of</strong> the index <strong>of</strong> direct popular rights is strongly reduced assoon as culture is included in the regression equation. <strong>The</strong> descriptive statistics in table A.3 <strong>of</strong>the Appendix and a corresponding analysis <strong>of</strong> variance show that the main variance <strong>of</strong> thisindex is between and not within the three language groups. 117 Taking into account that thelanguage <strong>of</strong> a canton is truly independent <strong>of</strong> its extent <strong>of</strong> direct popular rights, it becomes113 For reference categories and chosen weights, see there.114 Similar results are obtained when the model is estimated for the three waves <strong>of</strong> the SHP separately (see alsosection 3.2). Additionally, testing for various functional forms <strong>of</strong> the index <strong>of</strong> direct democracy does notreveal a considerably significant effect when culture is controlled for.115 In both datasets the religious variables are also not jointly significant at the 5% level.116 We only present the results for the relevant variables. <strong>The</strong> complete results can be received from the authorson request.117 61.3 % <strong>of</strong> the variance <strong>of</strong> the index <strong>of</strong> direct democracy is between and only 38.7 % is within the threelanguage groups. If we add the French and Italian part as one, we still get 60.6 % between and only 39.4 % <strong>of</strong>the variance between the groups.