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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

    () (Department of Political Studies, University of Otago)

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.

Suggested Citation

  • Philip Nel, 2006. "When Can the Rabble Redistribute? Democratization and Income Distribution in Low- and Middle-income Countries," Working Papers 43, ECINEQ, Society for the Study of Economic Inequality.
  • Handle: RePEc:inq:inqwps:ecineq2006-43
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    File URL: http://www.ecineq.org/milano/WP/ECINEQ2006-43.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Income distribution; redistribution; democratisation; median voter hypothesis;

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • F59 - International Economics - - International Relations, National Security, and International Political Economy - - - Other
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs

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