Outline
- What is Democracy?
- Do the institutions of electoral democracy facilitate or impede development?
- Is there a demonstrable correlation between the attributes of democracy and the attributes of effective economic development?
- Positive correlation between Democracy and Development
- Why Democracies excel
What
is Democracy?
•
Intrinsically, it is a necessary component of the ability of individuals to live
freely and autonomously.
•
Instrumentally, it is an institutional guarantee that the policies and laws created by a government will
have a reasonable fit with the fundamental interests of the people.
•
Thus democracy is a central determinant of the quality of life, and a central
element in the ability of men and women to live freely and autonomously as
human beings. This is no less so in poor and developing countries than it is in
the North and the West.
•A
true democracy cannot be restricted to this institutional framework alone. It
also needs to be embodied in a culture, a state of mind that fosters tolerance
and respect for other people, as well as pluralism, equilibrium and dialogue
between the forces that make up a society.
•
•Unlike
traditional conceptions, which are exclusively restricted to the domain of the
State, the concept of democratic culture requires all social, financial,
governmental and non-governmental actors, as well as the relationship which
links or separates them, to be taken into account.
•
Tenets
of normative democratic theory
•All
adult members of the collectivity ought to have the status of citizens (that
is, there ought to be no restriction in political rights for different groups
of people within the polity; universal citizenship principle).
•All
citizens ought to have the broadest set of political rights and liberties
possible, compatible with the extension of equal rights to all (that is, there
ought to be full equality and the broadest possible liberty for all citizens;
the liberty principle and the equality principle).
•
•Legislation
ought to reflect the principle of the sovereignty of the people. When and where
legislation is required, it ought to result from a process which involves the
meaningful expression of interest and preference by all citizens (popular
sovereignty principle).
•The
legislative process ought to weight no individual’s or group’s preferences more
heavily than those of any other individual or group (equal
weight principle).
•
•
•Finally,
a democratic society is one that is fully subject to the rule of law:
legislation rather than personal authority produces limitations on individual
liberty, and legislation is neutral across persons (legality
principle).
•Do the institutions of electoral democracy facilitate or
impede development?
•Samuel
Huntington characterizes the debate in terms of “conflict” and “compatibility”
theorists (Huntington and Harvard University. Center for International Affairs.
1968).
•
Conflict
theory
•Development
requires decisive policy choice and effective policy implementation;
authoritarian regimes are more decisive and more effective in implementing
policy.
•Ethnic
and sub-national conflicts interfere with economic development, and are most
effectively suppressed by strong authoritarian government.
•
•Authoritarian
governments are more able to effectively defer consumption in favor of savings.
Democratic regimes are under a political imperative to increase social welfare
spending, which reduces the rate of accumulation.
•Democracy
undermines investment (Huntington and Dominguez 1975).
•
•
Compatibility
Theory
•Progressive
development requires policy choices that lead to a development pathway that
produces a wide distribution of the benefits of growth; democratic regimes are
more effective at producing wide distribution of benefits (because of the
strong tendency of authoritarian regimes to structure economic activity towards
“rent-seeking” activities, enrichment of the ruling circle, and widespread
corruption).
•
•
•democratic
regimes are less prone to corruption and rent-seeking; they are less
“predatory”.
•Is there a demonstrable correlation between the attributes of
democracy and the attributes of effective economic development?
•A
large number of empirical studies have been undertaken to investigate this
question. However, the empirical case is suggestive but inconclusive. The data support
some optimism in support of the “compatibility” theory: that democratic
institutions have a net positive effect on economic development.
•
•However,
the association is empirically weak, and there are a number of counter-examples
in both directions: authoritarian regimes that have a good development record
(e.g. China, Singapore and Malaysia), and democratic regimes that have weak
development records (e.g. many states in sub-Saharan Africa).
•Positive
correlation between Democracy and Development
•
•
Globally, economic growth among democracies has been more
than 25% as rapid as
growth in autocracies, on average, for each of the past four decades (based on
independent indices of democracy). Even among low-income countries, democracies
have on average attained rates of per capita GDP growth equivalent to their
autocratic counterparts.
•
•Considering
the measures of social well-being, the performance of developing country
democracies is distinguished still further. Citizens in developing country
democracies have life expectancies that are nine years longer, infant mortality
rates that are 20% lower, secondary school attainment levels that are 40%
higher, fertility rates that are 30% lower, and cereal yields 25% greater, on
average, than those in autocracies at comparable income levels.
•
•The
strong showing by democracies cannot be attributed to greater resource
availability. Democracies do not run-up higher fiscal deficits nor do they
receive higher levels of aid. Rather, processes internal to democratic
systems appear to be
responsible for their performance.
•
•One
such characteristic is democracies’ ability to mitigate against catastrophe.
Democracies rarely let the bottom drop out of their economies. If we consider the
80 worst annual economic performances on record since 1960, only five have
occurred under democracies.
•
•Stated
differently, developing country democracies have been 70%
less likely to
experience a sharp contraction in their annual economic output (i.e. a drop of
10% of GDP) as have developing country autocracies.
•
Of those democracies that did experience such an economic disaster, two-thirds
were countries that had just transitioned from communist economies in the
1990s.
•
•Autocratic
propensity to catastrophe is even more evident in the humanitarian arena. The source
of nearly all of the world’s refugees and displaced persons are autocratic
governments. Ranking the world’s
worst refugee crises since 1980 by volume, one must go up to #88 to find one in
which the country of origin was other than an autocratic government – Sierra
Leone in 1997.
•
•The
close link between disaster and autocratic government is consistent with an
observation made by Nobel laureate Amartya Sen that there has never been a
major famine in a country with a democracy and a free press.
•
•A
key “secret” of democracies’ developmental success, therefore, is their
relative ability
to avoid catastrophe. Given the tenuous (fragile)existence facing most
communities living in poverty, a system that reduces volatility is a major
benefit.
•
•Moreover,
by not having to constantly dig out of the holes caused by sharp contractions, democracies
are better able to accumulate assets from year to year. As with a savings
account, it is the sustained gains that, when compounded, create prosperity.
•
•Another
often heard concern is that democratic competition can accentuate
fissures/divisions in a society leading to civil strife and undercutting
economic development. This is intuitively compelling. One need not think too
hard to envision opportunistic politicians playing up ethnic cleavages for
short-term political gain, only to have the situation spiral out of control.
•
•While
these risks are real, historical experience shows that democratizers are no
more conflict prone than other developing countries. Controlling for income is
key. Poverty is the single most powerful factor predicting conflict, (which
today nearly always means civil conflict).
•
•Since
1980, countries with per capita incomes below $2,000 have been in armed
conflict one year out of five. Countries with per capita incomes above $4,000,
in contrast, have experienced conflict only one year out of 33. After
controlling for income, democratizers have actually been slightly less conflict
prone than other developing countries.
•
•
•Infant
mortality rates under Africa’s semi-autocratic and autocratic governments, in
contrast, have been mostly stagnant, posting median changes of only 2.4 percent
and nil, respectively, since 1990. In other words, the vast majority of
citizens in autocratically-governed countries such as Gabon, Cameroon, Congo,
Swaziland, Zimbabwe, and Angola have seen little of no improvement in their
standards of living.
•
•African
democracies are also much more likely to avoid other forms of instability –
famine, conflict, and refugee crises. Illustratively, democratizers are the source of
less than 12 percent of Africa’s refugees; consolidating democracies comprise a
fraction of a percent.
•Where
conflicts in the region persist, they are disproportionately represented by
countries in the autocratic or semi-authoritarian categories.
•
•In
Africa, the move towards democracy has varied greatly. Roughly a quarter of
Africa’s 48 states can now be considered consolidating democracies. Another
quarter are demonstrably on a democratic path. However, the other half of
African states remain somewhere on the autocratic side of the governance
spectrum. Africa’s economic and social progress of the past decade closely
mirrors this divergence in political liberalization.
•
•Since
the mid-1990s, Africa’s democracies and democratizers have realized median aggregate increases in per capita
income of 15 percent. Autocratic and semi-autocratic governments, in
comparison, have experienced an average seven percent expansion in incomes
during this time. This includes the largely oil-driven growth gains of
countries such as Sudan, Cameroon, Gabon, Angola, and Equatorial Guinea, (which
has experienced a five-fold economic expansion since 1995).
•
•The
steady economic growth in Africa’s democracies translates into improved living
conditions for their citizens. Infant mortality rates, a proxy for many other
measures of well-being, have declined by 18 percent among consolidating
democracies since 1990, on average. Democratizers have also seen a commendable 14 percent average
improvement in infant deaths during the past 15 years.
•WHY DEMOCRACIES EXCEL
1.Shared power
A president or head of state must gain the support of key members of
his or her party, cabinet, legislature, and at times judiciary before a favored
policy can be pursued. In addition to these formal checks and balances, input
from civil society also influences the outcome. Together, these mechanisms of horizontal
accountability moderate
decision-making in democracies.
•
They also curb patronage, thereby improving the probability that funding allocations and hiring are based on merit rather than allegiances. Periodic elections, meanwhile, provide a clear incentive for democratic leaders to be responsive to the interests of the general public lest they be voted out of office.
•
2.
Openness
The greater access to information in open
societies fosters more informed policy debate and analysis before decisions are
taken. Leaders are compelled to respond to information and opinions they might
otherwise prefer to ignore. At the least, such a process helps weed out the
most egregious aspects of a policy before it is implemented – avoiding some of
the disasters that insulated decision-making processes produce.
•
•The
process of debate also serves an educational purpose. Citizens gain a
better appreciation for the trade-offs involved and will tend to be more
supportive of a policy once it has been adopted. During implementation, a
policy’s effects are closely scrutinized by opposition parties, the media,
think tanks, and independent observers. Should the policy prove ineffectual,
citizens will hear of it – and leaders will be obliged to take corrective
measures.
•
•In
times of crisis, such as an impending famine, the ability of the press to
report on the deteriorating situation serves as an indispensable early warning
system. The resulting pressure on the government to take urgent action helps mitigate
against catastrophe. In societies that lack this feedback mechanism, crises can
develop without citizens outside of the affected area even knowing about it,
leaving leaders little imperative to act.
•
•Democracies’
openness also has direct benefits for economic efficiency. Markets in which
buyers have access to independent sources of information generate greater
confidence and competitive prices.
•Markets
in which objective analysis is constrained are distrusted and investment
withheld.
•The
greater transparency of open societies, furthermore, is an indispensable factor
in curbing corruption – a major impediment to development.
•
3.
Adaptable
Political competition gives leaders ongoing
incentives to identify new ideas that will address public priorities. As
circumstances change, policies are adapted accordingly. Democracies, thus,
are in a perpetual process of realignment. If a given set of leaders fails to
fathom an appropriate course forward, the self-correcting nature of democracies
prompts their replacement with others who will bring a fresh set of assumptions
and strategies
•
•In
short, democracies are not guaranteed of getting it right. They do, however,
guarantee the right to keep changing until they do. Ineffectual leaders need
not drag down the entire country indefinitely. Indeed, the
ability of democracies to systematically change leaders may be the single
greatest reason for their stability.
•
•In
brief, democracies tend to attain economic progress because, on the whole, they
do a far better job of creating mechanisms of accountability than other
governance systems. It is democracy’s recognition of protected private space
that underlines its greater support for property rights and expropriation
protections.
•
•It
is democracy’s premise that all citizens, including the head of state, are
subject to the law that gives a foundation to the rule of law. It is
democracy’s openness that:
–provides the vehicle for policy debate,
–puts pressure on political leaders to reverse
ineffective policies,
–exposes deviations from the law, and
–shines the light of transparency on corruption.
•
