Dictatorship in a Single Export Crop Economy
Is it a matter of pure altruism or shortsightedness when a dictator spends an increasing amount of his revenues for the population, while cutting on own consumption? In order to be able to consume, the dictator first has to stay in power. We present a formal model of a power maximizing dictator. His revenues depend on the exports of a single crop. With the export earnings the dictator buys loyalty from the producers of the export crop by setting the domestic producer price. Revenues resulting from the di®erence between the international and the domestic price of the crop are used to finance a repressive apparatus. We characterize the optimal trade-o® between buying more loyalty and adapting the level of repression. The model is illustrated with a case study of Rwanda under president Habyarimana (1973-94).
|Date of creation:||Mar 2003|
|Contact details of provider:|| Web page: http://feb.kuleuven.be/Economics/|
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