The Origins of Democracy: A Model with Application to Ancient Greece

Abstract

JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org.. AbstractThis paper seeks to provide an improved understanding of the origins of democracy. It begins by developing a theoretical model to demonstrate how exogenous economic conditions can influence the incentives to establish democratic institutions. The model predicts that democratic institutions will expand where they mitigate important timeinconsistency problems and, therefore, encourage investment. Exogenous conditions determine the magnitude of those time-inconsistency problems and, hence, the likelihood of democracy. A comparison of ancient Greek city-states suggests that the conditions under which democracy first emerged support the model. Other potential applications are discussed.

Institutions, taxation, and market relationships in ancient Athens

“…In a recent paper dealing with ancient Greece, Fleck and Hanssen (2006) show that an elite may voluntarily introduce democracy as a way to commit credibly not to confiscate the increase in income that would be generated if ordinary farmers made long-term investments in their land. The elite benefits from democracy because the revenues from taxation of the farmers – now determined by the farmers themselves – could be higher than under aristocratic (oligarchic) rule.…”

The origins of the state: technology, cooperation and institutions

“…Our analysis is related to the three main strands of the vast literature on state formation. First, we share with North and Weingast (1989), Barzel and Kiser (1991), Fleck and Hanssen (2006) and Myerson (2008) the idea that elites enact more inclusive political institutions and a stronger protection of the nonelites' property rights on inputs because unable to incentivize them by committing to direct transfers. As Boranbay and Guerriero (2019) and , we stress that fiscal policies are key commitment devices in the elites' hands.…”

Tradeoffs of Inclusion: Development in Ancient Athens

“…In the existing literature, inclusion is the result of the elite (or ruler) finding it in their interest to extend access to institutions to a broader section of the populace. This might happen for a variety of reasons: because the elite fear revolution (Acemoglu & Robinson, 2000, 2006); as a result of bargains among a divided or heterogeneous elite that make it in the elite’s interest to share power (Lizzeri & Persico, 2004; North et al, 2009); because geographic and technological constraints make it difficult for the ruler to appropriate revenue (Mayshar, Moav, & Neeman, 2017); or to overcome time inconsistency problems that limit investment (Fleck & Hanssen, 2006; North & Weingast, 1989).…”

“… 11. The transition to democracy was certainly a step forward toward creating inclusive institutions. Much attention has already been devoted to this period: Acemoglu and Robinson (2016), Fleck and Hanssen (2006), Hanssen and Fleck (2013), Lyttkens (2006), McCannon (2012), and Ober (2008). This article is not concerned with Athens’ democratization and early steps toward political inclusion. …”

“… 38. Recent social scientific treatments women’s rights in ancient Greece include Fleck and Hanssen (2006) and Economou and Kyriazis (2017). …”