Lecture 7: Economic Development and Democracy

The Relationship
Perhaps the most common generalization linking political systems to other aspects of society is related to the state of economic development. The more wellto-do a nation, the greater the chances that it will sustain democracy. Seymour Martin Lipset, Political Man

Lipsets Evidence (1950s)

Step-pattern in terms of average levels of economic development: European and English-speaking stable democracies 2. European and English-speaking unstable democracies and dictatorships 3. Latin American democracies and unstable dictatorships 4. Latin American stable dictatorships
1.

Contemporary Evidence: National Wealth & Democracy

n

Of the 25 richest countries in human development, Singapore is the only non-democracy (excludes Hong Kong) Of the top 40 countries, only other exceptions are all oil-rich states with low populations: Brunei, Qatar, UAE All of the wealthy democracies are liberal democracies

Less-perfect correlation with $ economic development

30 richest countries in per capita income include six authoritarian states: Qatar, UAE, Brunei, Kuwait, Bahrain, Singapore. All but Singapore are oil states

Oil and Democracy Dont Mix

n

About 23 countries derive more than 60% of their exports earnings from oil and gas exports 12 of these are in the Middle East, 7 in Africa (e.g. Nigeria, Angola, Chad, Gabon, and Sudan), and also Russia, Azerbaijan, Brunei, and Venezuela. Not a single one of these 23 is a democracy.

UNDP Human Development Index

Average of three standardized measures: n Life expectancy at birth
n

Education

Average of: (a) Mean years of schooling of adults over 25 (b) Expected years of schooling for a child of school age

Gross national income

In Purchasing Power Parity (PPP) dollars

Oil countries are not as developed as they appear

n

Oil countries rank substantially lower in HDI than they do in money income (per capita GDP) All countries with Very High Human Development that are not democracies are oil exporters (except Singapore)

Country Ranks on Development (2011)

Country Rank on HDI Rank on GNI per capita, PPP$ Difference, GNI minus HDI

Norway US Germany Korea Singapore Czech Republic UAE Brunei Qatar Bahrain Chile Kuwait Equatorial Guinea

1 4 9 15 26 27 30 33 37 42 44 63 136

7 10 17 27 4 41 3 9 1 28 56 6 45

6 6 8 12 -22 14 -27 -25 -36 -14 14 -57 -91

Poverty & Democracy

n

Of the 46 countries ranking low on the latest UNDP Human Development Index (HDI for 2007), 13 (28%) are democracies With every step up the ladder of human development, a higher percentage of countries are democracies

The Relationship between Human Development & Democracy

Level of Human Development Number of Democracies Number of Countries Percent of countries that are democracies

Low Medium High Very High

13 21 33 41

46 47 47 46

28% 45% 70% 89%

Percent democracies by Human Development Level (2012)

100 80 60 40
20

89 70 45 28

0
Low Human Development Medium HD High HD Very High HD

Percent democracies by Human Development Level (2010)

100
90 80 70

86.5

77.7

60 50 40
30 20 10

37.5

37.8

44.7

Low HD (9/24)

Low-Med (14/37)

Upper-Med (17/38)

High (35/45)

Very High (32/37)

But many poor democracies are illiberal and fragile

Liberal Democracies (5)
Low Human Development n=46 D=13 LD=2
Benin (2,2) Sao Tome & Principe (2,2)

Illiberal Democracies (18)

Lesotho (2,3) Sierra Leone (2,3) Senegal (2,3) Malawi (3,4) E. Timor (3,4) Liberia (3,4) Niger (3,4) Zambia (3,4) Comoros (3,4) Bangladesh (3,4) Papua New Guinea (4,3)

Breakdowns of Democracy (16)

Niger Central African Republic Mozambique Gambia Sudan Nigeria Mauritania Madagascar Zambia Burundi Kenya Guinea-Bissau Mali, Haiti Nepal, Pakistan

High Human Development & Democracy

n

At the highest level of Human Development 41 of 46 countries are democracies (89%)

n n

All these democracies are liberal democracies Only Singapore, Brunei, Bahrain, Qatar and UAE are not democracies.

Strong Correlation between Development & Democracy

n

n n

Relationship has eroded at lower end, but still the more well-to-do a country (particularly in human development) the greater the chance of it being a democracy Even stronger correlation between development and freedom Correlation holds even if exclude rich West Correlation holds within each major civilization, save one (Islamic world)

Correlation of Democracy & HDI

(Welzel and Inglehart)
n

Democracy
n

(by Polity score)

and HDI =.59

(explains 35% of variation)

Freedom House score and HDI = .64

n

(explains 41% of variation)

Effective Democracy and HDI = .77

FH score x World Bank anticorruption score
n

(explains 60% of variation)

What causes what?

Possible Explanations
1. 2.

3. 4.

Development Democracy Development enables democracy to persist once it emerges (Liberal) Democracy development Stable democracy better development performance

Development & Democratic Survival

Findings of Przeworski et al. (1950-90) Income Level Below $1,000 $1,000-2,000 $2,000-4,000 $4,000-6,000 <$6,055
*Figures are in 1985 PPP dollars)

Probability of democratic in any given year 12% 6% 3% 1% 0%

Przeworski, et al (cont.)
Above $6,000
[in 1985 PPP$, or approx. $10,000 in 2008 PPP$]

democracies are impregnable and can be expected to live forever.

Non-Western democracies with per capita GDPs above $10,000 PPP

n n

Taiwan, South Korea ($30k+, $25k+) Slovenia, Czech Republic, Estonia, Slovakia, Hungary, Latvia, Lithuania, Poland, Croatia, Bulgaria, Romania Bahamas and other Caribbean countries Chile, Costa Rica, Argentina, Mexico, Uruguay Botswana, Mauritius, South Africa

n n n

Breakdowns of Democracy with per capita GDPs above $10,000 PPP?

n

Venezuela ($12,800, 2007 est)

Development Democracy Inglehart-Welzel Theory

Action Resources Self-expression Values Democratic Institutions

HUMAN EMPOWERMENT

Inglehart-Welzel: Action Resources

n

Action Resources: income, wealth, education, occupational skills Resources that give people autonomy, help them to govern their own lives Self expression values: tolerance, participation, trust, post-materialism

Inglehart-Welzel: Self-expression Values

n

Self-expression values: tolerance, participation, trust, post-materialism

Survival Values vs. Self-expression Values

n n

n n n n

Materialist vs. post-materialist values Respondent gives priority to economic and physical security over self-expression and quality of life Respondent describes self as not very happy Homosexuality is never justifiable Respondent has not and would not sign a petition Respondent agrees: You have to be very careful about trusting people

EXPANDING

ACTION

RESOURCES

HUMAN EMPOWERMENT

HUMAN

Economic growth and the welfare state increase peoples material means.

Rising levels of education, expanding mass communication and more knowledge-intensive work widen peoples intellectual skills.

Growing social complexity widens and diversifies peoples social opportunities.

Material Autonomy

Intellectual Autonomy

Social Autonomy

EMPOWERMENT

People get a sense of human autonomy which leads them to question unlimited and uncontrolled authority over people and makes them receptive to the ideas of individual freedom and equality.

RISING SELFEXPRESSION VALUES in democracies

in non-democracies

growing number of civil and political rights activists

growing mass support for civil and political rights movements

growing number of liberal reformers among elites

growing number of equal opportunity activists

growing mass support for equal opportunity movements

increasingly massresponsive elites

Formal adoption of democratic institutions

Increasing efficiency of democratic institutions

STRENGTHENING DEMOCRATIC

INSTITUTIONS

Inglehart-Welzel Causal Sequence

Economic Development Increased Individual Resources (Democratic) (Democratic) Self-expression Self-expression Values Value

Democratic Institutions
(Democracy + Rule of Law)

Causal Effect?
n

Correlation between % of population emphasizing selfexpression values in mid-1990s and level of effective democracy in 2000-2002 = .90 Correlation between % of population emphasizing selfexpression values in mid-1990s and level of formal democracy in 2000-2002 = .73

Causes of Effective Democracy

Variables
% emphasizing self-expression values, early 90s Years under democracy before 1990 Confidence in institutions, early 90s Democracy vs Autocracy Preference, early 90s Associational Activity, early 90s Norm Obedience, early 90s Variance Explained (R squared)
Standardized Regression Coefficients

(multiple regression)
Standardized Regression Coefficients

.80*** .12 .01

.72*** .08 .05 .16* -.05 .04

.80

.82

Modernization, Cultural Change, and Democracy, p. 152

Inglehart & Welzel conclusion

As growing socioeconomic resources broaden the range of activities that people can choose, self-expression values broaden the range of activities to which they aspire.

People who have become materially, intellectually, and socially more independent also want political independence, and thus give liberty priority over discipline, diversity over conformity, and autonomy over authority.

Modernization, Cultural Change, and Democracy, p. 152

Inglehart & Welzel conclusion

Thus, with higher levels of economic development and more predominant self-expression values, people seek the civil and political rights that define liberal democracy.

Development and Democracy: Expansion of income and education

1.

Political culture
Participation, knowledge, efficacy, tolerance, support for democracy, anti-authoritarianism

2.

Rise of an independent bourgeoisie

entrepreneurial middle class

3.

Transformation of economic structure

more resources independent of state

4.

Transformation of class structure

From a Pyramid

4.

Transformation of class structure

From a Pyramid to a Diamond ^_^

Small underclass; most people are middle-class, less polarization around class, more social mobility

5.

Transformation of social structure Disruption of clientelistic, hierarchical ties

Rise of horizontal ties that breed citizenship and social capital. Cross-cutting cleavages

6.

Growth of an independent, vigorous civil society. Growth of independent trade unions.

7.

Incorporation into global networks Diffusion of international norms Aspirations for global status

Sources of Democratic Stability

Polarized Ethnic Structure cleavage structure Class structure Inequality

Coherent Party Systems Programmate parties Moderate pluralism

Appropriate Institutional Designs Horizontal Accountability Autonomy of:

Judiciary Counter-Corruption Elected Administration Central Bank

Political Leadership
Skill Coalition-building Probity Policy choices Democratic Commitment

Scope of State Intervention

Demographic Youth Bulge Global Economic Integration Level of Human Development

Per Capita Income Literacy Life Expectancy

Effective Performance
economic growth human development equity social justice political order political liberty political participation transparency (restraint of corruption)

Legitimacy

Democratic Stability/ Consolidation

Diversified Economic Structure State Corporatism

Political Culture
Mass Elite

Civi lS Mas ociety: Volu s Me ntary d asso ia ciati ons

Civilian Supremacy Over the Military religion Political Traditions

Habituation

Education Political Socialization Historical Legacy/ Colonial Rule (Previous regimes)

International Environment
Democratic Legitimacy Democratic Conditionality Democratic Assistance Integration with Democracies