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When Can the Rabble Redistribute? Democratization and Income Distribution in Low- and Middle-income Countries

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  • Philip Nel

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    (Department of Political Studies, University of Otago)

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    Abstract

    In contrast to the experience in high-income OECD countries, the introduction of democracy in most low- and middle-income countries (LMICs) has been followed, as a rule, by a concentration of income. Using the median voter hypothesis as analytical tool, this paper explores the conditions under which positive regime change can lead to the mitigation of income inequality in LMICs. Analysis of panel data over the period 1960 to 1999 supports the contention that the degree to which popular sovereignty had been institutionalised through regime change is an important condition. Contrary to mainstream theory, economic openness in general tends to increase and not mitigate income inequality in countries where skilled labour is in short supply. Only in those countries with the requisite state capacity to disseminate skills amongst their populace on a broad scale, the electorate can use the vote effectively to reduce the effects of this tendency.

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    File URL: http://www.ecineq.org/milano/WP/ECINEQ2006-43.pdf
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    Bibliographic Info

    Paper provided by ECINEQ, Society for the Study of Economic Inequality in its series Working Papers with number 43.

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    Length: 43 pages
    Date of creation: 2006
    Date of revision:
    Handle: RePEc:inq:inqwps:ecineq2006-43

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    Keywords: Income distribution; redistribution; democratisation; median voter hypothesis;

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