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Inequality, income, and democracy in perspective: Insights from novel data analysis

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  • Rute Martins Caeiro
  • Rachel M. Gisselquist
  • Klarizze Anne Martin Puzon

Abstract

The relationship between economic development, inequality, and democratization has long been debated in the literature. Yet empirical analyses of this interplay have been limited and have yielded overall mixed and inconsistent results. This paper seeks to address this gap by examining the impact of income inequality on democracy, focusing particularly on the influential theory proposed by Acemoglu and Robinson, which predicts an inverted U-shaped relationship between inequality and democracy.

Suggested Citation

  • Rute Martins Caeiro & Rachel M. Gisselquist & Klarizze Anne Martin Puzon, 2025. "Inequality, income, and democracy in perspective: Insights from novel data analysis," WIDER Working Paper Series wp-2025-32, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2025-32
    as

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    References listed on IDEAS

    as
    1. Savoia, Antonio & Easaw, Joshy & McKay, Andrew, 2010. "Inequality, Democracy, and Institutions: A Critical Review of Recent Research," World Development, Elsevier, vol. 38(2), pages 142-154, February.
    2. Dorsch, Michael T. & Maarek, Paul, 2020. "Economic downturns, inequality, and democratic improvements," European Journal of Political Economy, Elsevier, vol. 62(C).
    3. Lipset, Seymour Martin, 1959. "Some Social Requisites of Democracy: Economic Development and Political Legitimacy1," American Political Science Review, Cambridge University Press, vol. 53(1), pages 69-105, March.
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