Political Rents, Promotion Incentives, and Support for a Non-Democratic Regime
This paper analyzes the economic foundations of a non-democratic political regime, where the ruling bureaucracy captures rents through collective control over state property and job assignment. The model developed here yields the equilibrium in the "political labor market," where the ruling bureaucracy buys services and political support of activists recruited from the working population. The underlying implicit contract requires that the incumbent bureaucrats retire after a certain time to allow for deferred promotion of activists into rent-paying positions. The major implications are that the stability of a non-democratic regime is consistent with high-income gap between the rulers and the rest of the population, strengthened when government pursues an active investment policy, and is not directly affected by public goods provision or the rate of economic growth. The results of econometric analysis of panel data from former Soviet states for the period of 1956-1968 confirm the predictions of the model.
|Date of creation:||Mar 2004|
|Date of revision:|
|Contact details of provider:|| Postal: PO Box 8269, New Haven CT 06520-8269|
Phone: (203) 432-3610
Fax: (203) 432-3898
Web page: http://www.econ.yale.edu/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Valsecchi, Irene, 2000.
" Job Assignment and Promotion,"
Journal of Economic Surveys,
Wiley Blackwell, vol. 14(1), pages 31-51, February.
- Schnytzer, Adi & Sustersic, Janez, 1998. "Why Join the Party in a One-Party System?: Popularity versus Political Exchange," Public Choice, Springer, vol. 94(1-2), pages 117-34, January.
- Mark Harrison, 2002.
"Coercion, compliance, and the collapse of the Soviet command economy,"
Economic History Review,
Economic History Society, vol. 55(3), pages 397-433, 08.
- Harrison, Mark, 2001. "Coercion, compliance and the collapse of the soviet command economy," The Warwick Economics Research Paper Series (TWERPS) 602, University of Warwick, Department of Economics.
- Martin C. McGuire & Mancur Olson Jr., 1996. "The Economics of Autocracy and Majority Rule: The Invisible Hand and the Use of Force," Journal of Economic Literature, American Economic Association, vol. 34(1), pages 72-96, March.
- Dimitriy Gershenson & Herschel I. Grossman, 1999.
"Cooption and Repression in the Soviet Union,"
99-25, Brown University, Department of Economics.
- Duffy, John & Papageorgiou, Chris, 2000. "A Cross-Country Empirical Investigation of the Aggregate Production Function Specification," Journal of Economic Growth, Springer, vol. 5(1), pages 87-120, March.
- Gregory,Paul R., 2003. "The Political Economy of Stalinism," Cambridge Books, Cambridge University Press, number 9780521533676, November.
- Acemoglu, Daron & Robinson, James A, 1999.
"A Theory of Political Transitions,"
CEPR Discussion Papers
2277, C.E.P.R. Discussion Papers.
- Moselle, Boaz & Polak, Benjamin, 2001. "A Model of a Predatory State," Journal of Law, Economics and Organization, Oxford University Press, vol. 17(1), pages 1-33, April.
- Barro, Robert J., 1999.
"Determinants of Democracy,"
3451297, Harvard University Department of Economics.
- Edward P. Lazear & Sherwin Rosen, 1979.
"Rank-Order Tournaments as Optimum Labor Contracts,"
NBER Working Papers
0401, National Bureau of Economic Research, Inc.
- Gregory,Paul R., 2003. "The Political Economy of Stalinism," Cambridge Books, Cambridge University Press, number 9780521826280, November.
- Adi Schnytzer & Janez Šušteršič, 1998. "Why join the party in a one-party system?: Popularity versus political exchange," Public Choice, Springer, vol. 94(1), pages 117-134, January.
- Canice Prendergast, 1999. "The Provision of Incentives in Firms," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 7-63, March.
- Acemoglu, Daron & Robinson, James A, 1998.
"Why did the West Extend the Franchise? Democracy, Inequality and Growth in Historical Perspective,"
CEPR Discussion Papers
1797, C.E.P.R. Discussion Papers.
- 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, Oxford University Press, vol. 115(4), pages 1167-1199.
- Wintrobe,Ronald, 1998. "The Political Economy of Dictatorship," Cambridge Books, Cambridge University Press, number 9780521583299, November.
- Grossman, Herschel I. & Noh, Suk Jae, 1994. "Proprietary public finance and economic welfare," Journal of Public Economics, Elsevier, vol. 53(2), pages 187-204, February.
- Yuhn, Ky-hyang, 1991. "Economic Growth, Technical Change Biases, and the Elasticity of Substitution: A Test of the De La Grandville Hypothesis," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 340-46, May.
- Easterly, William & Fischer, Stanley, 1995. "The Soviet Economic Decline," World Bank Economic Review, World Bank Group, vol. 9(3), pages 341-71, September.
- Yi Feng & Paul J. Zak, 1999. "The Determinants of Democratic Transitions," Journal of Conflict Resolution, Peace Science Society (International), vol. 43(2), pages 162-177, April.
When requesting a correction, please mention this item's handle: RePEc:egc:wpaper:882. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Louise Danishevsky)
If references are entirely missing, you can add them using this form.