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A Theory of Political Transitions

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Author Info
Acemoglu, Daron
Robinson, James A

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Abstract

We develop a theory of political transitions inspired in part by the experiences of Western Europe and Latin America. Nondemocratic societies are controlled by a rich elite. The initially disenfranchised poor can contest power by threatening social unrest or revolution, and this may force the elite to democratize. Democracy may not consolidate because it is more redistributive than a nondemocratic regime, and this gives the elite an incentive to mount a coup. Because inequality makes democracy more costly for the elite, highly unequal societies are less likely to consolidate democracy and may end up oscillating between regimes or in a nondemocratic repressive regime. An unequal society is likely to experience fiscal volatility, but the relationship between inequality and redistribution is nonmonotonic; societies with intermediate levels of inequality consolidate democracy and redistribute more than both very equal and very unequal countries. We also show that asset redistribution, such as educational and land reform, may be used to consolidate both democratic and nondemocratic regimes.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 2277.

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Date of creation: Oct 1999
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Handle: RePEc:cpr:ceprdp:2277

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Related research
Keywords: Democracy Dictatorship Inequality Political Instability Redistribution

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Find related papers by JEL classification:
D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Models of Political Processes: Rent-seeking, Elections, Legislatures, and Voting Behavior
D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances
O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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  1. Roland Benabou, 2000. "Unequal Societies: Income Distribution and the Social Contract," American Economic Review, American Economic Association, vol. 90(1), pages 96-129, March. [Downloadable!] (restricted)
  2. Benhabib, Jess & Rustichini, Aldo, 1996. " Social Conflict and Growth," Journal of Economic Growth, Springer, vol. 1(1), pages 125-42, March.
  3. Rudiger Dornbusch & Sebastian Edwards, 1991. "Macroeconomic Populism in Latin America," NBER Working Papers 2986, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  4. Benabou, R. & Ok, E.A., 1998. "Social Mobility and the Demand for Redistribution: The POUM Hypothesis," Working Papers 98-23, C.V. Starr Center for Applied Economics, New York University. [Downloadable!]
    Other versions:
  5. Roemer, John E, 1985. "Rationalizing Revolutionary Ideology," Econometrica, Econometric Society, vol. 53(1), pages 85-108, January. [Downloadable!] (restricted)
  6. Dani Rodrik, 1999. "Democracies Pay Higher Wages," The Quarterly Journal of Economics, MIT Press, vol. 114(3), pages 707-738, August. [Downloadable!] (restricted)
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  7. Verdier, Thierry, 1996. "The Rise and Fall of Elites: A Theory of Economic Development and Social Polarization in Rent-seeking Societies," CEPR Discussion Papers 1495, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  8. Daron Acemoglu & James Robinson, 1999. "A Theory of Political Transitions," Working papers 99-26, Massachusetts Institute of Technology (MIT), Department of Economics.
    Other versions:
  9. Alesina, Alberto & Rodrik, Dani, 1994. "Distributive Politics and Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 109(2), pages 465-90, May. [Downloadable!] (restricted)
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  10. Meltzer, Allan H & Richard, Scott F, 1981. "A Rational Theory of the Size of Government," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 914-27, October. [Downloadable!] (restricted)
  11. Daron Acemoglu & James A. Robinson, 2000. "Why Did The West Extend The Franchise? Democracy, Inequality, And Growth In Historical Perspective," The Quarterly Journal of Economics, MIT Press, vol. 115(4), pages 1167-1199, November. [Downloadable!] (restricted)
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  12. Matthew Ellman & Leonard Wantchekon, 2000. "Electoral Competition Under The Threat Of Political Unrest," The Quarterly Journal of Economics, MIT Press, vol. 115(2), pages 499-531, May. [Downloadable!] (restricted)
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  13. Alesina, Alberto & Perotti, Roberto, 1996. "Income distribution, political instability, and investment," European Economic Review, Elsevier, vol. 40(6), pages 1203-1228, June. [Downloadable!] (restricted)
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  14. Grossman, Herschel I, 1994. "Production, Appropriation, and Land Reform," American Economic Review, American Economic Association, vol. 84(3), pages 705-12, June. [Downloadable!] (restricted)
  15. Roemer, John E., 1998. "Why the poor do not expropriate the rich: an old argument in new garb," Journal of Public Economics, Elsevier, vol. 70(3), pages 399-424, December. [Downloadable!] (restricted)
  16. Torsten Persson & Guido Tabellini, 1991. "Is Inequality Harmful for Growth? Theory and Evidence," NBER Working Papers 3599, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  17. Grossman, Herschel I., 1995. "Insurrections," Handbook of Defense Economics, in: Keith Hartley & Todd Sandler (ed.), Handbook of Defense Economics, edition 1, volume 1, chapter 8, pages 191-212 Elsevier. [Downloadable!] (restricted)
  18. Wright, Randall, 1996. "Taxes, redistribution, and growth," Journal of Public Economics, Elsevier, vol. 62(3), pages 327-338, November. [Downloadable!] (restricted)
  19. Tornell, Aaron & Velasco, Andes, 1992. "The Tragedy of the Commons and Economic Growth: Why Does Capital Flow from Poor to Rich Countries?," Journal of Political Economy, University of Chicago Press, vol. 100(6), pages 1208-31, December. [Downloadable!] (restricted)
  20. Acemoglu, Daron & Zilibotti, Fabrizio, 1997. "Was Prometheus Unbound by Chance? Risk, Diversification, and Growth," Journal of Political Economy, University of Chicago Press, vol. 105(4), pages 709-51, August.
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  21. Horowitz, Andrew W, 1993. "Time Paths of Land Reform: A Theoretical Model of Reform Dynamics," American Economic Review, American Economic Association, vol. 83(4), pages 1003-10, September. [Downloadable!] (restricted)
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