Dictatorship, Democracy, and Development

Abstract

Part of a series of writings that began with the author's essay on ‘Autocracy, Democracy, and Prosperity’, published in 1991. It puts forth, in an intuitive and non‐technical way, a part of the theory that is set out with formal proofs and crucial additional results in McGuire and Olson's ‘Economics of Autocracy and Majority Rule’. It analyses the kings or dictators who control autocratic governments—and the oligarchies or majorities or other ruling interests that control other types of government—in just the way that economists analyse the behaviour of firms, consumers, and workers. That is, it takes a broader approach to economics by applying the familiar assumption of rational self‐interest to the autocrats or other ruling interests that control a government, and then finds what types of policy will best serve the ruling interest.

The Curley Effect: The Economics of Shaping the Electorate

“…Some distinguished observers (Olson 1993) argue that sufficiently forward-looking leaders will avoid policies that harm their electorate. But the Curley effect relies critically on forward-looking behavior: when it operates, longer time horizons raise the attraction of socially costly political conduct.…”

Ruling Elites' Rotation and Asset Ownership: Implications for Property Rights

“…Twenty years ago Mancur Olson (1993) conjectured that in the case of autocracies longer tenure of the regime improves property rights protection, in the spirit of the henceforth famous "stationary bandit" metaphor. This conjecture however lacks empirical support -ossified dictatorships rarely deliver robust economic performance.…”

“…Twenty years ago Mancur Olson (1993) proposed his famous "stationary bandit" metaphor to argue that an authoritarian ruler with a firm grip on power has a stake in private sector development and hence the incentives to invest in public goods, including secure property rights and contract enforcement. Indeed, such pubic goods expand the tax base, and if an increase in tax yield accrues over a sufficiently long period of time, it would recoup the investments into public goods (in the case of property rights -the forgone short-term gains from expropriated property and repudiated contracts).…”

“…Less than fully stable autocracies are not destined to degenerate into "roving bandits" (Olson, 1993) -they might still have the incentives to maintain secure property rights (e.g. by preserving relatively independent judiciary) that they would need themselves in the event of losing power, when the present rulers are subjected to the same treatment as everyone else outside of the ruling circle.…”

Generational effects and gender height dimorphism in contemporary Spain

“…However, the effects of economic and political liberalization on height do not necessarily go hand in hand (Olson, 1993). Whilst economic liberalization may bring reforms that improve access to food sources, introduction of new technologies and so on, some studies find that the main effects on human capital come from political liberalization and the introduction of democratic decision-making systems (Tavares and Wacziarg, 2001).…”