The point at which an economically unequal autocratic society might experience a revolution to democratization may be more of a delicate balance of circumstances than is currently believed.
SPP Assistant Professor Michael Dorsch and his colleague Paul Maarek of Université de Cergy-Pontoise, presented their paper on this issue Inequality and Democratization: Reconsidering the Economic View, at the European Public Choice Society Meeting in Cambridge, England on April 6.
The most prominent economic theory of democratization suggests that a unified elite group in an autocratic society will voluntarily concede political power to the masses when there is a particularly strong threat that the masses will revolt. Recent work in political science has cast empirical doubt over the role of income inequality in transitions towards democracy though, in some cases predicting the opposite.
While current economic theory implies that macro-economic shocks should be conditional on the degree of economic inequality in a society, the implication has thus far not been investigated empirically. Dorsch and Maarek have begun to set this situation straight by investigating the extent to which democratization episodes have been encouraged by greater degrees of income inequality in a panel of autocratic countries between 1960 and 2010.
“Our paper bridges these two empirical literatures by testing a nuance of the standard economic view that has been ignore,” write Dorsch and Maarek. “Namely, the theory implies that the likelihood that a growth slowdown (of a given size) triggers a democratization depends on the degree of income inequality in society. Therefore, we consider the interaction between macroeconomic contractions and distributional dynamics in our empirical investigation.”
The findings of Dorsch and Maarek’s paper provide supporting evidence that there is an interactive effect between growth shocks and income inequality.
You can read more about their research here.