IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/27561.html
   My bibliography  Save this paper

Концентрация Доходов, Нестабильность Демократии И Экономический Рост
[Income Concentration, Instability of Democracy and the Economic Growth]

Author

Listed:
  • Polterovich, Victor
  • Popov, Vladimir
  • Tonis, Alexander

Abstract

In our previous papers (Polterovich V., Popov V., 2007; Polterovich V., Popov V., Tonis A., 2006) it was shown that democratization (increase in the political rights index of the Freedom house in 1970-2000) can negatively affect economic growth, if the quality of institutions at the beginning of the period is low; several mechanisms of such an impact were analyzed. In this paper we offer the brief review of previous results and examine another possible mechanism, which is associated with the unevenness in income distribution. Our empirical (econometric) research demonstrates that under weak institutions both democratization and resource wealth are associated with greater income inequality, which in turn reduces the stability of democratic regimes and increases the chances of return to authoritarianism. The instability of democracy also leads to the deterioration of institutions and suppresses economic growth. These empirical results are being explained in the framework of a game theoretic model that demonstrates instability of democracy under poor institutions and high income inequality.

Suggested Citation

  • Polterovich, Victor & Popov, Vladimir & Tonis, Alexander, 2009. "Концентрация Доходов, Нестабильность Демократии И Экономический Рост [Income Concentration, Instability of Democracy and the Economic Growth]," MPRA Paper 27561, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:27561
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/27561/1/MPRA_paper_27561.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Bulte, Erwin H & Damania, Richard & Deacon, Robert, 2003. "Resource Abundance, Poverty and Development," University of California at Santa Barbara, Economics Working Paper Series qt66z854gv, Department of Economics, UC Santa Barbara.
    2. Barro, Robert J, 1996. "Democracy and Growth," Journal of Economic Growth, Springer, vol. 1(1), pages 1-27, March.
    3. Daron Acemoglu & Simon Johnson & James A. Robinson & Pierre Yared, 2008. "Income and Democracy," American Economic Review, American Economic Association, vol. 98(3), pages 808-842, June.
    4. Vladimir Popov, 2000. "Shock Therapy Versus Gradualism: The End Of The Debate (Explaining The Magnitude Of Transformational Recession)," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 42(1), pages 1-57, April.
    5. Vladimir Popov, 2007. "Shock Therapy versus Gradualism Reconsidered: Lessons from Transition Economies after 15 Years of Reforms1," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 49(1), pages 1-31, March.
    6. Fidrmuc, Jan, 2003. "Economic reform, democracy and growth during post-communist transition," European Journal of Political Economy, Elsevier, vol. 19(3), pages 583-604, September.
    7. Robert J. Barro, 1999. "Determinants of Democracy," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages 158-183, December.
    8. Mark Gradstein & Branko Milanovic, 2000. "Does Liberté = Egalité? A Survey of the Empirical Evidence on the Links between Political Democracy and Income Inequality," CESifo Working Paper Series 261, CESifo.
    9. V. Popov., 2007. "Shock Therapy versus Gradualism: 15 Years Later," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 5.
    10. Polterovich, Victor & Popov, Vladimir & Tonis, Alexander, 2007. "Resource Abundance, Political Corruption, and Instability of Democracy," MPRA Paper 19154, University Library of Munich, Germany.
    11. Polterovich, Victor & Popov, Vladimir, 2007. "Democratization, Quality of Institutions and Economic Growth," MPRA Paper 19152, University Library of Munich, Germany.
    12. Vladimir Popov, 2006. "Shock Therapy Versus Gradualism Reconsidered: Lessons From Transition Economies After 15 Years Of Reforms," Working Papers w0068, New Economic School (NES).
    13. Adam Przeworski & Fernando Limongi, 1993. "Political Regimes and Economic Growth," Journal of Economic Perspectives, American Economic Association, vol. 7(3), pages 51-69, Summer.
    14. Natalia Dinello & Vladimir Popov (ed.), 2007. "Political Institutions and Development," Books, Edward Elgar Publishing, number 12689.
    15. Phillip Arestis & Michelle Baddeley & John S.L. McCombie (ed.), 2007. "Economic Growth," Books, Edward Elgar Publishing, number 3958.
    16. Torvik, Ragnar, 2002. "Natural resources, rent seeking and welfare," Journal of Development Economics, Elsevier, vol. 67(2), pages 455-470, April.
    17. Polterovich, Victor, 2007. "Institutional Trap," MPRA Paper 20595, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bozhechkova, Alexandra Viktorovna & Vashelyuk, Natalia. & Nazarov, P.A. & Perevyshin, Yuri & Tumanova, Elena Alexandrovna & Shagas, Natalia, 2015. "Modeling the Effects of Economic Policy and Changes in the Behavior of Economic Agents," Published Papers 2311, Russian Presidential Academy of National Economy and Public Administration.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Polterovich, Victor & Popov, Vladimir, 2007. "Демократизация И Экономический Рост [Democratization and Economic Growth]," MPRA Paper 23012, University Library of Munich, Germany.
    2. Polterovich, Victor & Popov, Vladimir, 2007. "Democratization, Quality of Institutions and Economic Growth," MPRA Paper 19152, University Library of Munich, Germany.
    3. Vladimir Popov, 2009. "Why the West Became Rich before China and Why China Has Been Catching Up with the West since 1949: nother Explanation of the “Great Divergence” and “Great Convergence” Stories," Working Papers w0132, New Economic School (NES).
    4. Popov, Vladimir, 2010. "Development theories and development experience: half a century journey," MPRA Paper 28111, University Library of Munich, Germany.
    5. Полтерович В. М. & Попов В. В. & Тонис А. С., 2008. "Нестабильность Демократии В Странах, Богатых Ресурсами," Higher School of Economics Economic Journal Экономический журнал Высшей школы экономики, CyberLeninka;Федеральное государственное автономное образовательное учреждение высшего образования «Национальный исследовательский университет «Высшая школа экономики», vol. 12(2), pages 176-200.
    6. Polterovich, Victor & Popov, Vladimir & Tonis, Alexander, 2008. "Mechanisms of Resource Curse, Economic Policy and Growth," MPRA Paper 20570, University Library of Munich, Germany.
    7. Ichiro Iwasaki & Taku Suzuki, 2016. "Radicalism Versus Gradualism: An Analytical Survey Of The Transition Strategy Debate," Journal of Economic Surveys, Wiley Blackwell, vol. 30(4), pages 807-834, September.
    8. Brunnschweiler, Christa N. & Bulte, Erwin H., 2008. "The resource curse revisited and revised: A tale of paradoxes and red herrings," Journal of Environmental Economics and Management, Elsevier, vol. 55(3), pages 248-264, May.
    9. Elias Papaioannou & Gregorios Siourounis, 2008. "Democratisation and Growth," Economic Journal, Royal Economic Society, vol. 118(532), pages 1520-1551, October.
    10. Popov, Vladimir, 2010. "The Long Road to Normalcy," WIDER Working Paper Series 013, World Institute for Development Economic Research (UNU-WIDER).
    11. Vladimir Popov, 2009. "Lessons from the Transition Economies: Putting the Success Stories of the Postcommunist World into a Broader Perspective," WIDER Working Paper Series RP2009-15, World Institute for Development Economic Research (UNU-WIDER).
    12. Torsten Persson & Guido Tabellini, 2009. "Democratic Capital: The Nexus of Political and Economic Change," American Economic Journal: Macroeconomics, American Economic Association, vol. 1(2), pages 88-126, July.
    13. Pettersson, Jan, 2003. "Democracy, Consolidation and Growth," Research Papers in Economics 2002:16, Stockholm University, Department of Economics, revised 15 Dec 2004.
    14. Daron Acemoglu & Suresh Naidu & Pascual Restrepo & James A. Robinson, 2019. "Democracy Does Cause Growth," Journal of Political Economy, University of Chicago Press, vol. 127(1), pages 47-100.
    15. Gradstein, Mark, 2005. "Democracy, Property Rights, Redistribution and Economic Growth," CEPR Discussion Papers 5130, C.E.P.R. Discussion Papers.
    16. Mina Baliamoune, 2009. "Elites, Education and Reforms," ICER Working Papers 18-2009, ICER - International Centre for Economic Research.
    17. Manuel Couret Branco, 2006. "The Political Economy of Democratic Governance and Economic Development," Economics Working Papers 12_2006, University of Évora, Department of Economics (Portugal).
    18. Giavazzi, Francesco & Tabellini, Guido, 2005. "Economic and political liberalizations," Journal of Monetary Economics, Elsevier, vol. 52(7), pages 1297-1330, October.
    19. Thomas Apolte, 2011. "Democracy and prosperity in two decades of transition," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 19(4), pages 693-722, October.
    20. Vladimir Popov, 2010. "The Long Road to Normalcy: Where Russia Now Stands," WIDER Working Paper Series wp-2010-013, World Institute for Development Economic Research (UNU-WIDER).

    More about this item

    Keywords

    income concentration; democracy; autocracy; elections; political stability; economic growth;
    All these keywords.

    JEL classification:

    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:27561. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.