Economic origins of dictatorship and democracy

433 Pages·2006·2.68 MB·English

by  Daron Acemoglu

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ECONOMICORIGINSOFDICTATORSHIPANDDEMOCRACY
This book develops a framework for analyzing the creation and consolidation of
democracy. Different social groups prefer different political institutions because of
thewaytheyallocatepoliticalpowerandresources.Thus,democracyispreferredby
themajorityofcitizensbutopposedbyelites.Dictatorship,nevertheless,isnotstable
whencitizenscanthreatensocialdisorderandrevolution.Inresponse,whenthecosts
ofrepressionaresufficientlyhighandpromisesofconcessionsarenotcredible,elites
maybeforcedtocreatedemocracy.Bydemocratizing,elitescredibilytransferpolitical
power to the citizens, ensuring social stability. Democracy consolidates when elites
do not have a strong incentive to overthrow it. These processes depend on (1) the
strength of civil society, (2) the structure of political institutions, (3) the nature of
politicalandeconomiccrises,(4)thelevelofeconomicinequality,(5)thestructure
oftheeconomy,and(6)theformandextentofglobalization.
Daron Acemoglu is Charles P. Kindleberger Professor of Applied Economics in the
DepartmentofEconomicsattheMassachusettsInstituteofTechnologyandamember
oftheEconomicGrowthProgramoftheCanadianInstituteforAdvancedResearch.
HeisalsoaffiliatedwiththeNationalBureauofEconomicResearch,CenterforEco-
nomic Performance, and Centre for Economic Policy Research and is a Fellow of
the European Economic Association. Professor Acemoglu previously taught at the
LondonSchoolofEconomics.Hereceivedtheawardforbestpaperpublishedinthe
EconomicJournalin1996forhispaper“ConsumerConfidenceandRationalExpec-
tations:AreAgents’BeliefsConsistentwiththeTheory?”,theinauguralT.W.Shultz
PrizeattheUniversityofChicagoin2004,andtheinauguralSherwinRosenAward
foroutstandingcontributiontolaboreconomicsin2004.ProfessorAcemogluised-
itor of the eminent journal Review of Economics and Statistics and associate editor
oftheJournalofEconomicGrowth.Heistherecipientofthe2005JohnBatesClark
MedalfromtheAmericanEconomicAssociation,awardedtothemostoutstanding
economistworkingintheUnitedStatesunderage40.
JamesA.RobinsonisProfessorofGovernmentatHarvardUniversity.Hepreviously
taughtattheUniversityofCalifornia,Berkeley,theUniversityofSouthernCalifornia,
andtheUniversityofMelbourne.HeisamemberoftheEconomicGrowthProgram
oftheCanadianInstituteforAdvancedResearchandaffiliatedwiththeCentreforEco-
nomicPolicyResearch.A2002CarnegieScholaranda1999–2000HooverInstitution
Fellow,hisresearchhasbeenpublishedinleadingjournalssuchastheQuarterlyJournal
of Economics, American Economic Review, American Political Science Review, and
JournalofEconomicLiterature.ProfessorRobinsonisontheeditorialboardofWorld
Politics. Together with Professors Daron Acemoglu and Simon Johnson, Professor
Robinsoniscoauthoroftheforthcomingbook,TheInstitutionalRootsofProsperity.
i
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Economic Origins of Dictatorship
and Democracy
DARON ACEMOGLU
.
JAMES A ROBINSON
iii
cambridge university press
Cambridge, New York, Melbourne, Madrid, Cape Town, Singapore, São Paulo
Cambridge University Press
TheEdinburghBuilding,Cambridgecb22ru,UK
Published in the United States of America by Cambridge University Press, New York
www.cambridge.org
Information on this title: www.cambridge.org/9780521855266
©DaronAcemogluandJamesA.Robinson2006
Thispublicationisincopyright.Subjecttostatutoryexceptionandtotheprovisionof
relevantcollectivelicensingagreements,noreproductionofanypartmaytakeplace
withoutthewrittenpermissionofCambridgeUniversityPress.
Firstpublishedinprintformat 2005
isbn-13 978-0-511-14081-5 eBook (NetLibrary)
isbn-10 0-511-14081-9
eBook (NetLibrary)
isbn-13 978-0-521-85526-6 hardback
isbn-10 0-521-85526-8 hardback
CambridgeUniversityPresshasnoresponsibilityforthepersistenceoraccuracyofurls
forexternalorthird-partyinternetwebsitesreferredtointhispublication,anddoesnot
guaranteethatanycontentonsuchwebsitesis,orwillremain,accurateorappropriate.
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Tothememoryofmyparents,KevorkandIrma,whoinvestedsomuchinme.
Tomylove,Asu,whohasbeenmyinspirationandcompanionthroughout.
DaronAcemoglu
Tothememoryofmymother,fromwhomIinheritedmypassionforbooks
andmyindignationattheinjusticesofthislife.Tothememoryofmyfather,
fromwhomIinheritedmyfascinationforscienceandmycuriosityaboutthis
extraordinaryworld.
JamesA.Robinson
v
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Contents
Preface pagexi
partone.questionsandanswers
1. PathsofPoliticalDevelopment 1
1. Britain 2
2. Argentina 5
3. Singapore 8
4. SouthAfrica 10
5. TheAgenda 14
2. OurArgument 15
1. DemocracyversusNondemocracy 16
2. BuildingBlocksofOurApproach 19
3. TowardOurBasicStory 22
4. OurTheoryofDemocratization 23
5. DemocraticConsolidation 30
6. DeterminantsofDemocracy 31
7. PoliticalIdentitiesandtheNatureofConflict 42
8. DemocracyinaPicture 43
9. OverviewoftheBook 46
3. WhatDoWeKnowaboutDemocracy? 48
1. MeasuringDemocracy 48
2. PatternsofDemocracy 51
3. Democracy,Inequality,andRedistribution 58
4. CrisesandDemocracy 65
5. SocialUnrestandDemocratization 65
6. TheLiterature 75
7. OurContribution 80
vii
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viii Contents
parttwo.modelingpolitics
4. DemocraticPolitics 89
1. Introduction 89
2. AggregatingIndividualPreferences 91
3. Single-PeakedPreferencesandtheMedianVoterTheorem 92
4. OurWorkhorseModels 99
5. DemocracyandPoliticalEquality 113
6. Conclusion 117
5. NondemocraticPolitics 118
1. Introduction 118
2. PowerandConstraintsinNondemocraticPolitics 120
3. ModelingPreferencesandConstraintsinNondemocracies 128
4. CommitmentProblems 133
5. ASimpleGameofPromises 144
6. ADynamicModel 151
7. Incentive-CompatiblePromises 161
8. Conclusion 171
partthree.thecreationandconsolidation
ofdemocracy
6. Democratization 173
1. Introduction 173
2. TheRoleofPoliticalInstitutions 173
3. PreferencesoverPoliticalInstitutions 176
4. PoliticalPowerandInstitutions 177
5. AStaticModelofDemocratization 181
6. DemocratizationorRepression? 186
7. ADynamicModelofDemocratization 193
8. SubgamePerfectEquilibria 201
9. AlternativePoliticalIdentities 203
10. TargetedTransfers 207
11. PoweroftheElitesinDemocracy 207
12. IdeologicalPreferencesoverRegimes 211
13. DemocratizationinaPicture 214
14. EquilibriumRevolutions 215
15. Conclusion 218
7. CoupsandConsolidation 221
1. Introduction 221
2. IncentivesforCoups 224
3. AStaticModelofCoups 225
4. ADynamicModeloftheCreationandConsolidationofDemocracy 231
5. AlternativePoliticalIdentities 245
6. TargetedTransfers 246
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Contents ix
7. PowerinDemocracyandCoups 247
8. ConsolidationinaPicture 249
9. DefensiveCoups 250
10. Conclusion 252
partfour.puttingthemodelstowork
8. TheRoleoftheMiddleClass 253
1. Introduction 253
2. TheThree-ClassModel 259
3. EmergenceofPartialDemocracy 262
4. FromPartialtoFullDemocracy 267
5. Repression:TheMiddleClassasaBuffer 274
6. Repression:SoftlinersversusHardliners 278
7. TheRoleoftheMiddleClassinConsolidatingDemocracy 283
8. Conclusion 285
9. EconomicStructureandDemocracy 287
1. Introduction 287
2. EconomicStructureandIncomeDistribution 290
3. PoliticalConflict 292
4. Capital,Land,andtheTransitiontoDemocracy 293
5. CostsofCouponCapitalandLand 296
6. Capital,Land,andtheBurdenofDemocracy 300
7. ConflictbetweenLandownersandIndustrialists 307
8. Industrialists,Landowners,andDemocracyinPractice 312
9. EconomicInstitutions 313
10. HumanCapital 316
11. ConjecturesaboutPoliticalDevelopment 317
12. Conclusion 319
10. GlobalizationandDemocracy 321
1. Introduction 321
2. AModelofanOpenEconomy 325
3. PoliticalConflict–DemocraticConsolidation 331
4. PoliticalConflict–TransitiontoDemocracy 334
5. FinancialIntegration 338
6. IncreasedPoliticalIntegration 344
7. AlternativeAssumptionsabouttheNatureofInternationalTrade 345
8. Conclusion 348
partfive.conclusionsandthefutureofdemocracy
11. ConclusionsandtheFutureofDemocracy 349
1. PathsofPoliticalDevelopmentRevisited 349
2. ExtensionsandAreasforFutureResearch 355
3. TheFutureofDemocracy 358