This paper analyzes the effect of political finance policy on parties and democratic development, with a primary focus on societies in which democracy is either relatively new or reemerging after crisis. Democratic development should not focus solely on corruption control but also on enhancing open political competition and on strengthening political parties through regulated funding and an engaged citizenry.

This paper reviews the five models of party law that regulate political parties and addresses the elements that party leaders should consider in devising party law. While excess regulation can stifle the formation of parties, insufficient regulation can contribute to chaotic governance. The paper systematically reviews party laws in 169 polities.