The Relationship between Level of Institutions and Duration of Crises

This study searches for a connection between the quality level of institutions and the duration of a banking crisis. It does this by examining five different variables: the autocracy and democracy score from the Polity IV dataset, together making the Polity score, central bank independence, and financial liberalization. The dataset covers 108 different crises, divided into systemic and non-systemic crises. The main question is; do any of the variables have an influence on the duration of a crisis? I found that for systemic crises, Polity score and financial liberalization have an influence on the duration of a crisis. Polity score also has an influence on the duration of a non-systemic banking crisis, although it prolongs a crisis, when the Polity score is above zero. Also, central bank independence has an influence on non-systemic crises. When I pool the dataset, Polity score does not have a significant impact anymore, central bank independence and financial liberalization both do have a significant influence.