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Democratic Development and Authoritarian Development Compared

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This chapter deals with the superiority of democracy over authoritarianism in terms of economic performance. By comparing the statistics for the economic performances of democratic governments from 1987 to 2008 to those of authoritarian governments from 1961 to 1987, I show that, regardless of their economic policy regimes, democratic governments performed better than authoritarian ones in all categories of economic performance, except GDP growth rate: domestic investment rate, gross fixed capital formation, international balance of trade, inflation rate, unemployment rate. The lessons we learn from Korean experiences of economic development are that democracy does matter for sustaining a high-growth economy with equity. The performance of democratic governments in Korea since 1987 supports the democratic development thesis, namely “democracy first, economic development later,” because economic development follows from the good governance made by good democracy.

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This study addresses a core issue of comparative political economy - the role of political institutions in economic performance. What difference have modern states made to the development of the market economy? Under what conditions and for what purposes have states sought to assist the process of industrial advancement? The book examines why modern states differ so considerably in their capacity for governing the market. They also examine the nature of state "strength", and its importance for a prosperous economy changed over time. Through a comparative history of political and economic development, this volume examines changing state-economy relations from the rise of market economies in Europe to the present, focusing on Britain, Russia, Japan, Taiwan, Korea, and the United States. It provides arguments and explanations of the rise of modern states and markets, of early and late industrialization, of state capacity and national competitiveness. Through case studies and comparisons, the authors develop a neo-statist theory to explain the changing economic fortunes of political systems, from the rise of Europe to the gradual decline of Anglo-American industry and the recent ascendance of East Asia.
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The authors of this ambitious book address a fundamental political question: why are leaders who produce peace and prosperity turned out of office while those who preside over corruption, war, and misery endure? Considering this political puzzle, they also answer the related economic question of why some countries experience successful economic development and others do not. The authors construct a provocative theory on the selection of leaders and present specific formal models from which their central claims can be deduced. They show how political leaders allocate resources and how institutions for selecting leaders create incentives for leaders to pursue good and bad public policy. They also extend the model to explain the consequences of war on political survival. Throughout the book, they provide illustrations from history, ranging from ancient Sparta to Vichy France, and test the model against statistics gathered from cross-national data. The authors explain the political intuition underlying their theory in nontechnical language, reserving formal proofs for chapter appendixes. They conclude by presenting policy prescriptions based on what has been demonstrated theoretically and empirically.
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Przeworski et al. (2000) challenge the key hypothesis in modernization theory: political regimes do not transition to democracy as per capita incomes rise, they argue. Rather, democratic transitions occur randomly, but once there, countries with higher levels of GDP per capita remain democratic. We retest the modernization hypothesis using new data, new techniques, and a three-way rather than dichotomous classification of regimes. Contrary to Przeworski et al. (2000) we find that the modernization hypothesis stands up well. We also find that partial democracies emerge as among the most important and least understood regime types. African and African American Studies Government Author's Original
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ABOUT THIS BOOK Alexis de Tocqueville (1805-59) came to America in 1831 to see what a great republic was like. What struck him most was the country's equality of conditions, its democracy. The book he wrote on his return to France, Democracy in America, is both the best ever written on democracy and the best ever written on America. It remains the most often quoted book about the United States, not only because it has something to interest and please everyone, but also because it has something to teach everyone. When it was published in 2000, Harvey Mansfield and Delba Winthrop's new translation of Democracy in America—only the third since the original two-volume work was published in 1835 and 1840—was lauded in all quarters as the finest and most definitive edition of Tocqueville's classic thus far. Mansfield and Winthrop have restored the nuances of Tocqueville's language, with the expressed goal "to convey Tocqueville's thought as he held it rather than to restate it in comparable terms of today." The result is a translation with minimal interpretation, but with impeccable annotations of unfamiliar references and a masterful introduction placing the work and its author in the broader contexts of political philosophy and statesmanship.
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In this paper, I investigate why a bureaucratic-authoritarian (hereafter BA) regime emerged in South Korea during the early 1970s. The regime transition was the outcome of conflict among key political actors who were constrained, although not in a deterministic way, by the change in the Korean economic structure. It can be understood as the outcome of strategic choices made by key political actors among alternatives that satisfied structural constraints.
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Despite considerable normative support, analysts have failed to identify any systematic effects of democracy on domestic policy outputs. Building on a theory of the state as a monopoly producer of public services and establishing a common foundation for studying variations in regimes and their policy consequences, the authors hypothesize that democratic states will earn fewer monopoly rents and produce a higher level of services than autocracies. They test this hypothesis both cross-sectionally and over time for a variety of public health and education indicators. The statistical results strongly support their hypotheses. The authors conclude that democracy has real, substantively important effects on the daily lives and well-being of individuals around the globe.
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In recent years, debate on the state's economic role has too often devolved into diatribes against intervention. Peter Evans questions such simplistic views, offering a new vision of why state involvement works in some cases and produces disasters in others. To illustrate, he looks at how state agencies, local entrepreneurs, and transnational corporations shaped the emergence of computer industries in Brazil, India, and Korea during the seventies and eighties. Evans starts with the idea that states vary in the way they are organized and tied to society. In some nations, like Zaire, the state is predatory, ruthlessly extracting and providing nothing of value in return. In others, like Korea, it is developmental, promoting industrial transformation. In still others, like Brazil and India, it is in between, sometimes helping, sometimes hindering. Evans's years of comparative research on the successes and failures of state involvement in the process of industrialization have here been crafted into a persuasive and entertaining work, which demonstrates that successful state action requires an understanding of its own limits, a realistic relationship to the global economy, and the combination of coherent internal organization and close links to society that Evans called "embedded autonomy."
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Examines the role that institutions, defined as the humanly devised constraints that shape human interaction, play in economic performance and how those institutions change and how a model of dynamic institutions explains the differential performance of economies through time. Institutions are separate from organizations, which are assemblages of people directed to strategically operating within institutional constraints. Institutions affect the economy by influencing, together with technology, transaction and production costs. They do this by reducing uncertainty in human interaction, albeit not always efficiently. Entrepreneurs accomplish incremental changes in institutions by perceiving opportunities to do better through altering the institutional framework of political and economic organizations. Importantly, the ability to perceive these opportunities depends on both the completeness of information and the mental constructs used to process that information. Thus, institutions and entrepreneurs stand in a symbiotic relationship where each gives feedback to the other. Neoclassical economics suggests that inefficient institutions ought to be rapidly replaced. This symbiotic relationship helps explain why this theoretical consequence is often not observed: while this relationship allows growth, it also allows inefficient institutions to persist. The author identifies changes in relative prices and prevailing ideas as the source of institutional alterations. Transaction costs, however, may keep relative price changes from being fully exploited. Transaction costs are influenced by institutions and institutional development is accordingly path-dependent. (CAR)
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Does economic development lead to political democracy? Or does political democracy generate economic development? Through reviewing literature of political economy of development, this study attempts to show audience at least five possible patterns and theoretical explanations of the connections between development and democracy. They are: 1) development first, democracy later, also modernization theory, 2) political change process, 3) development not leads to democracy, 4) democracy first, development later, and 5) democracy not matters in development. Furthermore, I point out that in the process of democratization economic development varies from stage to stage: it declines in the early phrase, but increases in the later; investigating economic change corresponding to political transition is critical to reconsider the causality between development and democracy. Lastly, I conclude that the controversy over development and democracy is inconclusive and will be continuing.
Article
Economic markets are a necessary, though not sufficient, condition for democracy, but is democracy a requirement for efficient economic markets? The first relationship is widely assumed to apply; the second is much more controversial. Skepticism about the economic efficiency of democracy leads to three related theses: that market reforms can be successfully introduced only under an authoritarian regime; that economic reform must precede political reform; and that only when successful economic development has occurred can conditions favorable to the installation and consolidation of democracy emerge. Such views are defended frequently by politicians and political scientists alike. They have been expressed recently by Datuk Seri Mahathir bin Mohamad, prime minister of Malaysia: In the former Soviet Union and the East European countries, democracy was introduced along with the free market. The result is chaos and increased misery. Not only have the countries broken up, mainly through bloody civil wars, but there is actual recession and more hardship for the people than when the Communists ruled. One may ask whether democracy is the means or the end. Democracy at all costs is not much different from Communist authoritarianism from the barrel of a gun . . . . In a number of East Asian countries, while democracy is still eschewed, the free market has been accepted and has brought prosperity. Perhaps it is [End Page 17] the authoritarian stability which enabled this to happen. Should we enforce democracy on people who may not be able to handle it and destroy stability?1 Unlike Prime Minister Mahathir, many people do indeed think that democracy is an end, not just a means. Setting this consideration aside, however, do theory and evidence really show that the economic efficiency of democracy is less than that of other forms of government? When citizens suffer economic hardship under new democratic regimes, which are often receiving assistance in carrying out needed economic reforms from international organizations, is it reasonable for them to think that they would fare better under an authoritarian regime? Do we have to accept what Atul Kohli has called the "cruel choice" between development and democracy?2 Or can democracy also be defended on the grounds of its capacity to promote economic development? The proauthoritarian theses rest on the argument that dictatorships enjoy a greater political capacity and a higher level of insulation from particularistic demands than do democratic regimes. As Jagdish Bhagwati has noted, this view was initially presented in the context of analyses of development that focused on the problem of how to promote high rates of investment.3 New democracies were seen as vulnerable to demands for immediate consumption because of a collective-action problem: the short-term interest of social groups in turning economic policies into a distributive game would prevail at the expense of the long-term benefits that would eventually have accrued from cooperative sacrifices. The economic results of such vulnerability are an inefficient distribution of income, an increase in consumption and a corresponding decline in savings and investment, expanding budgets, and increasing fiscal deficits. The political result is instability and, very likely, a breakdown of the regime. Only when a state is insulated from particularistic pressures, it was argued, can it behave as the universalistic agent it needs to be to ensure efficient economic performance. Authoritarian regimes appear to meet this requirement: because they are less dependent on popular support and do not have to concern themselves with electoral cycles, they have a greater capacity to implement policies that may be unpopular. Of course, if the reform process is to be successful, these policies have to be the right ones, and unless dictators are themselves enlightened, their decisions may be the right ones only if the rulers are responsive to enlightened outside pressures (for example, those exerted by international economic institutions). Successful economic reform would thus require an authoritarian regime that is internally insulated but externally malleable. And it is this paradox that points to the basic problem with the proauthoritarian theses. In general, authoritarian regimes have more limited incentives and more [End Page 18] limited access to information than democratic regimes. When the focus of development strategies moved from the accumulation of...
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DELEGATIVE DEMOCRACY Guillermo O'Donnell Guillermo O'DonneU, an Argentine political scientist, is Helen Kellogg Professor of lnternational Studies and Academic Director of the Kellogg Institute of International Studies at the University of Notre Dame. His books include Modernization and Bureaucratic-Authoritarianism (1979); Bureaucratic-Authoritarianism: Argentina, 1966-1973, in Comparative Perspective (1988); and, with Philippe Schmitter and Laurence Whitehead, Transitions from Authoritarian Rule (1986). Here I depict a "new species," a type of existing democracies that has yet to be theorized. As often happens, it has many similarities with other, already recognized species, with cases shading off between the former and some variety of the latter. Still, I believe that the differences are significant enough to warrant an attempt at such a depiction. The drawing of neater boundaries between these types of democracy depends on empirical research, as well as more refined analytical work that I am now undertaking. But if I really have found a new species (and not a member of an already recognized family, or a form too evanescent to merit conceptualization), it may be worth exploring its main features. Scholars who have worked on democratic transitions and consolidation have repeatedly said that, since it would be wrong to assume that these processes all culminate in the same result, we need a typology of democracies. Some interesting efforts have been made, focused on the consequences, in terms of types of democracy and policy patterns, of various paths to democratization. I My own ongoing research suggests, however, that the more decisive factors for generating various kinds of democracy are not related to the characteristics of the preceding authoritarian regime or to the process of transition. Instead, I believe that we must focus upon various long-term historical factors, as well as the degree of severity of the socioeconomic problems that newly installed democratic governments inherit. Let me briefly state the main points of my argument: 1) Existing Journal of Democracy Vol. 5, No. 1 January 1994 56 Journal of Democracy theories and typologies of democracy refer to representative democracy as it exists, with all its variations and subtypes, in highly developed capitalist countries. 2) Some newly installed democracies (Argentina, Brazil, Peru, Ecuador, Bolivia, Philippines, Korea, and many postcommunist countries) are democracies, in the sense that they meet Robert Dahl's criteria for the definition of polyarchy. 2 3) Yet these democracies are not -- and do not seem to be on the path toward becoming -- representative democracies; they present characteristics that prompt me to call them delegative democracies (DD). 4) DDs are not consolidated (i.e., institutionalized) democracies, but they may be enduring. In many cases, there is no sign either of any imminent threat of an authoritarian regression, or of advances toward representative democracy. 5) There is an important interaction effect: the deep social and economic crisis that most of these countries inherited from their authoritarian predecessors reinforces certain practices and conceptions about the proper exercise of political authority that lead in the direction of delegative, not representative democracy. The following considerations underlie the argument presented above: 3 A) The installation of a democratically elected government opens the way for a "second transition," often longer and more complex than the initial transition from authoritarian rule. B) This second transition is supposed to be from a democratically elected government to an institutionalized, consolidated democratic regime. C) Nothing guarantees, however, that this second transition will occur. New democracies may regress to authoritarian rule, or they may stall in a feeble, uncertain situation. This situation may endure without opening avenues for institutionalized forms of democracy. D) The crucial element determining the success of the second transition is the building of a set of institutions that become important decisional points in the flow of political power. E) For such a successful outcome to occur, governmental policies and the political strategies of various agents must embody the recognition of a paramount shared interest in democratic institution building. The successful cases have featured a decisive coalition of broadly supported political leaders who take great care in creating and strengthening democratic political institutions. These institutions, in turn, have made it easier to cope with the social and economic problems inherited from the authoritarian regime. This...
Article
Journal of Democracy 10.3 (1999) 3-17 In the summer of 1997, I was asked by a leading Japanese newspaper what I thought was the most important thing that had happened in the twentieth century. I found this to be an unusually thought-provoking question, since so many things of gravity have happened over the last hundred years. The European empires, especially the British and French ones that had so dominated the nineteenth century, came to an end. We witnessed two world wars. We saw the rise and fall of fascism and Nazism. The century witnessed the rise of communism, and its fall (as in the former Soviet bloc) or radical transformation (as in China). We also saw a shift from the economic dominance of the West to a new economic balance much more dominated by Japan and East and Southeast Asia. Even though that region is going through some financial and economic problems right now, this is not going to nullify the shift in the balance of the world economy that has occurred over many decades (in the case of Japan, through nearly the entire century). The past hundred years are not lacking in important events. Nevertheless, among the great variety of developments that have occurred in the twentieth century, I did not, ultimately, have any difficulty in choosing one as the preeminent development of the period: the rise of democracy. This is not to deny that other occurrences have also been important, but I would argue that in the distant future, when people look back at what happened in this century, they will find it difficult not to accord primacy to the emergence of democracy as the preeminently acceptable form of governance. The idea of democracy originated, of course, in ancient Greece, more than two millennia ago. Piecemeal efforts at democratization were attempted elsewhere as well, including in India. But it is really in ancient Greece that the idea of democracy took shape and was seriously put into practice (albeit on a limited scale), before it collapsed and was replaced by more authoritarian and asymmetric forms of government. There were no other kinds anywhere else. Thereafter, democracy as we know it took a long time to emerge. Its gradual -- and ultimately triumphant -- emergence as a working system of governance was bolstered by many developments, from the signing of the Magna Carta in 1215, to the French and the American Revolutions in the eighteenth century, to the widening of the franchise in Europe and North America in the nineteenth century. It was in the twentieth century, however, that the idea of democracy became established as the "normal" form of government to which any nation is entitled -- whether in Europe, America, Asia, or Africa. The idea of democracy as a universal commitment is quite new, and it is quintessentially a product of the twentieth century. The rebels who forced restraint on the king of England through the Magna Carta saw the need as an entirely local one. In contrast, the American fighters for independence and the revolutionaries in France contributed greatly to an understanding of the need for democracy as a general system. Yet the focus of their practical demands remained quite local -- confined, in effect, to the two sides of the North Atlantic, and founded on the special economic, social, and political history of the region. Throughout the nineteenth century, theorists of democracy found it quite natural to discuss whether one country or another was "fit for democracy." This thinking changed only in the twentieth century, with the recognition that the question itself was wrong: A country does not have to be deemed fit for democracy; rather, it has to become fit through democracy. This is indeed a momentous change, extending the potential reach of democracy to cover billions of people, with their varying histories and cultures and disparate levels of affluence. It was also in this century that people finally accepted that "franchise for all adults" must mean all--not just men but also women. When in January of this year I had the opportunity to meet Ruth Dreyfuss, the president of Switzerland and a woman of remarkable distinction, it gave me occasion to recollect that only...
Book
This volume brings together Atul Kohli's essays published over the last twenty-five years. They are organized in three sections, each section representing a distinct theme-political change; political economy; and politics and development in select states. The introductory essay provides an 'umbrella' for these essays, giving the volume a significant and useful coherence. This essay accomplishes two intellectual tasks-outlines the state-society frame of reference that underlies much of the author's published work; and provides an overview of the author's interpretation of broad political and economic changes in India, especially in the post-Nehru period. It also provides references to other relevant works not included in this volume, and then situates the specific essays in the volume within the broader changes.
Book
The Asian crisis has sparked a thoroughgoing reappraisal of current international financial norms, the policy prescriptions of the International Monetary Fund, and the adequacy of the existing financial architecture. To draw proper policy conclusions from the crisis, it is necessary to understand exactly what happened and why from both a political and an economic perspective. In this study, renowned political scientist Stephan Haggard examines the political aspects of the crisis in the countries most affected--Korea, Thailand, Malaysia, and Indonesia. * Haggard focuses on the political economy of the crisis, emphasizing the longer-run problems of moral hazard and corruption, as well as the politics of crisis management and the political fallout that ensued. He looks at the degree to which each government has rewoven the social safety net and discusses corporate and financial restructuring and greater transparency in business-government relations. Professor Haggard provides a counterpoint to the analysis by examining why Singapore, Taiwan, and the Philippines escaped financial calamity.
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This book develops a framework for analyzing the creation and consolidation of democracy. Different social groups prefer different political institutions because of the way they allocate political power and resources. Thus democracy is preferred by the majority of citizens, but opposed by elites. Dictatorship nevertheless is not stable when citizens can threaten social disorder and revolution. In response, when the costs of repression are sufficiently high and promises of concessions are not credible, elites may be forced to create democracy. By democratizing, elites credibly transfer political power to the citizens, ensuring social stability. Democracy consolidates when elites do not have 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 political and economic crises, (4) the level of economic inequality, (5) the structure of the economy, and (6) the form and extent of globalization.
Book
Is economic development conducive to political democracy? Does democracy foster or hinder material welfare? These two questions are examined by looking at the experience of 135 countries between 1950 and 1990. Descriptive information, statistical analyses, and historical narratives are interwoven to gain an understanding of the dynamic of political regimes and their impact on economic development and other aspects of material welfare. The findings, several most surprising, dispel any notion of a trade-off between democracy and development. Economic development does not generate democracies but democracies are much more likely to survive in wealthy societies. Political regimes have no impact on the growth of total national incomes, while political instability affects growth only in dictatorships. Per capita incomes grow faster in democracies since population increases faster under dictatorships. In general, political regimes have more of an effect on demography than on economics.
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The main thesis of this study is that the world economy is undergoing a profound structural change that is forcing companies to reorganize their production on a global scale. This is being brought about both through the relocation of production to new industrial sites, increasingly in the developing countries, and through the accelerated rationalisation measures at the traditional sites of industrial manufacture. The authors have designated this structural movement as ‘the new international division of labour’, and argue that it has led to the crisis that can be observed in industrial countries, as well as to the first steps towards export-oriented manufacturing in the developing countries. They see these trends as being largely independent of the policies pursued by individual governments and the strategies for expansion adopted by individual firms, and argue that the conditions currently prevailing in the capitalist world economy mean that the efforts of individual countries to devise economic policies to reduce industrial unemployment in the industrialised countries or to accentuate a balanced process of industrialisation in the developing countries are doomed to failure.
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This paper reviews the new political economy and its relevance to explaining policymaking in the developing countries. Copyright 1990 Blackwell Publishers Ltd..
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T he post-World War 11 era has witnessed the successful culmination of national liberation movements and the emergence of several fully independent states. The wars against the erstwhile colonial rule were fought mainly on economic grounds, but the post-independence experience has shown only modest gains by way of economic advance. Imbalance in the structure of resource endowments, high rates of population growth, outdated modes of production, scarcity of productive capital, and inappropriate models of economic development are some of the causes that find a place in any list that purports to explain this lack of economic development. Generally omitted from this list, however, is the political context within which economic forces play their roles. A cursory look at the historical evidence would suggest that those countries which cherished and preserved a democratic framework fared much worse than those that adopted a nondemocratic or dictatorial framework. 1 Democracies throughout the Third World have collapsed under the burden of economic stagnation and have given way to dictatorships of either the right or the left. Commentators have bemoaned the fact that nearly two-thirds of the world's population currently lives under nondemocratic forms of government. Yet, few of them have clearly come out in support of the view that democracy and economic development may not go together. What follows is an explanation of why democracy as is generally understood may not be suitable to meet the challenges of a developing economy and how democratic institutions generally fail to respond to the immediate demands of a population impatient to raise its level of living.
Article
Under anarchy, uncoordinated competitive theft by “roving bandits” destroys the incentive to invest and produce, leaving little for either the population or the bandits. Both can be better off if a bandit sets himself up as a dictator—a “stationary bandit” who monopolizes and rationalizes theft in the form of taxes. A secure autocrat has an encompassing interest in his domain that leads him to provide a peaceful order and other public goods that increase productivity. Whenever an autocrat expects a brief tenure, it pays him to confiscate those assets whose tax yield over his tenure is less than their total value. This incentive plus the inherent uncertainty of succession in dictatorships imply that autocracies will rarely have good economic performance for more than a generation. The conditions necessary for a lasting democracy are the same necessary for the security of property and contract rights that generates economic growth.