Saturday, August 11, 2012

What determines democracy? And what helps to maintain it?

by Martin Gassebner, Michael J. Lamla and James Raymond Vreeland


August 11, 2012

Will democracy establish itself in the Middle East? This column looks at what is needed to start democracies are what is needed to keep them going. It argues that that it is the level of economic development – not short-run economic growth – that is needed for democracy to survive.

Democracy is on the move in the Arab world. Whether democratic regimes will emerge and survive remains an open question, and the intense media coverage of the Arab Spring has revived public interest in the determinants of democracy. The quest to understand why democracy emerges and survives, however, has long been on the agenda of economists and political scientists.

Scientific findings suggest that life is better with more democracies in the world. People living under democracy have higher incomes and tend to enjoy more human rights than people living under authoritarian regimes (Hathaway 2003). Democracies also don’t go to war against each other, and make better trade partners (Russett and Oneal 2001).

So the promotion of democracy is laudable, but do we really know how to ‘cause’ democracy? Scholars have proposed and empirically tested many theories. Yet, no conclusive picture has emerged. Moreover, it is not clear whether the same set of variables that drives the democratisation process also guarantee its sustainability.

Economic explanations of democracy date back to Lipset (1959) who is often cited as father of 'modernisation theory'. The theory contends that as countries develop economically, social structures become too complex for authoritarian regimes to manage. At some point, dictatorship collapses and democracy emerges as the alternative. Przeworski et al. (2000) contend, however, that the emergence of democracy is random with respect to economic development. The correlation between development and democracy is driven instead by the survival of democracy. Przeworski (2005, 253) argues that "democracy prevails in developed societies because too much is at stake in turning against it." Conversely, in poor democracies, "the value of becoming a dictator is greater and the accumulated cost of destroying capital stock is lower" (Przeworski and Limongi 1997, 166). So democracy emerges idiosyncratically, but it survives in countries with high levels of economic development.


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