IDEAS home Printed from https://ideas.repec.org/a/lus/reveco/v71y2020i2p135-167n3.html
   My bibliography  Save this article

The Democracy–Economy-Nexus

Author

Listed:
  • Brieger Stefan

    (Technische Universität Dresden, Dresden, Germany)

  • Markwardt Gunther

    (Brandenburg University of Technology & CESifo, Cottbus, Germany)

Abstract

Despite a sizeable theoretical and empirical literature, no firm conclusions have been drawn regarding the democracy–economy-nexus. This paper aims to assess the twosided relationship between democracy and economic development based on the current state of research. Literature will be used to examine whether and how democracy affects economic development, as well as the reverse question. Does economic development influence the form of government of a society, i.e. can it promote or hinder a transition from autocracy to democracy? In addition to approaches that postulate a positive relationship, we will also present perspectives that either negatively interpret a correlation between the two variables or completely negate it.

Suggested Citation

  • Brieger Stefan & Markwardt Gunther, 2020. "The Democracy–Economy-Nexus," Review of Economics, De Gruyter, vol. 71(2), pages 135-167, August.
    • Handle: RePEc:lus:reveco:v:71:y:2020:i:2:p:135-167:n:3
    DOI: 10.1515/roe-2020-0031
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/roe-2020-0031
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.1515/roe-2020-0031?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Elias Papaioannou & Gregorios Siourounis, 2008. "Democratisation and Growth," Economic Journal, Royal Economic Society, vol. 118(532), pages 1520-1551, October.
    2. Torsten Persson & Guido Tabellini, 2006. "Democracy and Development: The Devil in the Details," American Economic Review, American Economic Association, vol. 96(2), pages 319-324, May.
    3. Narayan, Paresh Kumar & Narayan, Seema & Smyth, Russell, 2011. "Does democracy facilitate economic growth or does economic growth facilitate democracy? An empirical study of Sub-Saharan Africa," Economic Modelling, Elsevier, vol. 28(3), pages 900-910, May.
    4. Daron Acemoglu & Suresh Naidu & Pascual Restrepo & James A. Robinson, 2019. "Democracy Does Cause Growth," Journal of Political Economy, University of Chicago Press, vol. 127(1), pages 47-100.
    5. Helliwell, John F., 1994. "Empirical Linkages Between Democracy and Economic Growth," British Journal of Political Science, Cambridge University Press, vol. 24(2), pages 225-248, April.
    6. Barro, Robert J, 1996. "Democracy and Growth," Journal of Economic Growth, Springer, vol. 1(1), pages 1-27, March.
    7. Adam Przeworski & Fernando Limongi, 1993. "Political Regimes and Economic Growth," Journal of Economic Perspectives, American Economic Association, vol. 7(3), pages 51-69, Summer.
    8. Torsten Persson & Guido Tabellini, 2009. "Democratic Capital: The Nexus of Political and Economic Change," American Economic Journal: Macroeconomics, American Economic Association, vol. 1(2), pages 88-126, July.
    9. Dani Rodrik & Romain Wacziarg, 2005. "Do Democratic Transitions Produce Bad Economic Outcomes?," American Economic Review, American Economic Association, vol. 95(2), pages 50-55, May.
    10. Fabrice Murtin & Romain Wacziarg, 2014. "The democratic transition," Journal of Economic Growth, Springer, vol. 19(2), pages 141-181, June.
    11. Saint-Paul, Gilles & Verdier, Thierry, 1993. "Education, democracy and growth," Journal of Development Economics, Elsevier, vol. 42(2), pages 399-407, December.
    12. Alberto Alesina & Dani Rodrik, 1994. "Distributive Politics and Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(2), pages 465-490.
    13. Daniel Treisman, 2015. "Income, Democracy, and Leader Turnover," American Journal of Political Science, John Wiley & Sons, vol. 59(4), pages 927-942, October.
    14. Tavares, Jose & Wacziarg, Romain, 2001. "How democracy affects growth," European Economic Review, Elsevier, vol. 45(8), pages 1341-1378, August.
    15. Colagrossi, Marco & Rossignoli, Domenico & Maggioni, Mario A., 2020. "Does democracy cause growth? A meta-analysis (of 2000 regressions)," European Journal of Political Economy, Elsevier, vol. 61(C).
    16. Edward L. Glaeser & Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 2004. "Do Institutions Cause Growth?," Journal of Economic Growth, Springer, vol. 9(3), pages 271-303, September.
    17. Yong Glasure & Aie-Rie Lee & James Norris, 1999. "Level of economic development and political democracy revisited," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 5(4), pages 466-477, November.
    18. Acemoglu, Daron & Johnson, Simon & Robinson, James A. & Yared, Pierre, 2009. "Reevaluating the modernization hypothesis," Journal of Monetary Economics, Elsevier, vol. 56(8), pages 1043-1058, November.
    19. Philippe Aghion & Alberto Alesina & Francesco Trebbi, 2007. "Democracy, Technology, and Growth," NBER Working Papers 13180, National Bureau of Economic Research, Inc.
    20. Uwe Sunde, 2006. "Wirtschaftliche Entwicklung und Demokratie – Ist Demokratie ein Wohlstandsmotor oder ein Wohlstandsprodukt?," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 7(4), pages 471-499, November.
    21. repec:hal:spmain:info:hdl:2441/5m0od0o9jn9pqbdmos7fpt28hg is not listed on IDEAS
    22. Daniel Treisman, 2010. "Oil and Democracy in Russia," NBER Working Papers 15667, National Bureau of Economic Research, Inc.
    23. Knutsen, Carl Henrik, 2013. "Democracy, State Capacity, and Economic Growth," World Development, Elsevier, vol. 43(C), pages 1-18.
    24. Robert J. Barro, 1999. "Determinants of Democracy," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages 158-183, December.
    25. 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.
    26. Hristos Doucouliagos & Mehmet Ali Ulubaşoğlu, 2008. "Democracy and Economic Growth: A Meta‐Analysis," American Journal of Political Science, John Wiley & Sons, vol. 52(1), pages 61-83, January.
    27. Krueger, Anne O, 1974. "The Political Economy of the Rent-Seeking Society," American Economic Review, American Economic Association, vol. 64(3), pages 291-303, June.
    28. Wafa Ghardallou & Dorsaf Sridi, 2020. "Democracy and Economic Growth: a Literature Review," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 11(3), pages 982-1002, September.
    29. Ludovic Comeau, 2003. "Democracy and Growth: A Relationship Revisited," Eastern Economic Journal, Eastern Economic Association, vol. 29(1), pages 1-21, Winter.
    30. Gründler, Klaus & Krieger, Tommy, 2015. "Democracy and growth: Evidence from SVMDI indices," Discussion Paper Series 131, Julius Maximilian University of Würzburg, Chair of Economic Order and Social Policy.
    31. Gründler, Klaus & Krieger, Tommy, 2016. "Democracy and growth: Evidence from a machine learning indicator," European Journal of Political Economy, Elsevier, vol. 45(S), pages 85-107.
    32. Michael K. Miller, 2012. "Economic Development, Violent Leader Removal, and Democratization," American Journal of Political Science, John Wiley & Sons, vol. 56(4), pages 1002-1020, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sima, Di & Huang, Fali, 2023. "Is democracy good for growth? — Development at political transition time matters," European Journal of Political Economy, Elsevier, vol. 78(C).
    2. Méon, Pierre-Guillaume & Sekkat, Khalid, 2022. "A time to throw stones, a time to reap: how long does it take for democratic transitions to improve institutional outcomes?," Journal of Institutional Economics, Cambridge University Press, vol. 18(3), pages 429-443, June.
    3. Daron Acemoglu & Suresh Naidu & Pascual Restrepo & James A. Robinson, 2019. "Democracy Does Cause Growth," Journal of Political Economy, University of Chicago Press, vol. 127(1), pages 47-100.
    4. Jorge Braga Macedo & Joaquim Oliveira Martins & João Tovar Jalles, 2021. "Globalization, Freedoms and Economic convergence: an empirical exploration of a trivariate relationship using a large panel," International Economics and Economic Policy, Springer, vol. 18(3), pages 605-629, July.
    5. Colagrossi, Marco & Rossignoli, Domenico & Maggioni, Mario A., 2020. "Does democracy cause growth? A meta-analysis (of 2000 regressions)," European Journal of Political Economy, Elsevier, vol. 61(C).
    6. Hibrahim Limi Kouotou & Boniface Ngah Epo, 2022. "Duration of heads of state in power and economic growth: a Sub-Saharan African tale," Economics Bulletin, AccessEcon, vol. 42(2), pages 1153-1170.
    7. Madsen, Jakob B. & Raschky, Paul A. & Skali, Ahmed, 2015. "Does democracy drive income in the world, 1500–2000?," European Economic Review, Elsevier, vol. 78(C), pages 175-195.
    8. Fabrice Murtin & Romain Wacziarg, 2014. "The democratic transition," Journal of Economic Growth, Springer, vol. 19(2), pages 141-181, June.
    9. Hyungmin Park, 2024. "Theory of developmental dictatorship," Discussion Papers 2024-10, Nottingham Interdisciplinary Centre for Economic and Political Research (NICEP).
    10. repec:spo:wpmain:info:hdl:2441/5m0od0o9jn9pqbdmos7fpt28hg is not listed on IDEAS
    11. repec:hal:spmain:info:hdl:2441/5m0od0o9jn9pqbdmos7fpt28hg is not listed on IDEAS
    12. Alessandro Melcarne & Juan S. Mora-Sanguinetti & Rok Spruk, 2021. "Democracy, technocracy and economic growth: evidence from 20 century Spain," Working Papers 2118, Banco de España.
    13. Lars Pelke, 2023. "Reanalysing the link between democracy and economic development," International Area Studies Review, Center for International Area Studies, Hankuk University of Foreign Studies, vol. 26(4), pages 361-383, December.
    14. Pakhnin, M. & Shapovalov, R., 2023. "Democratic capital and economic growth in the countries of the third wave of democratization," Journal of the New Economic Association, New Economic Association, vol. 58(1), pages 12-31.
    15. Elias Papaioannou & Gregorios Siourounis, 2008. "Democratisation and Growth," Economic Journal, Royal Economic Society, vol. 118(532), pages 1520-1551, October.
    16. Nisticò, Roberto, 2022. "Political institutions and economic development over more than a century," Structural Change and Economic Dynamics, Elsevier, vol. 61(C), pages 199-215.
    17. Gründler, Klaus & Krieger, Tommy, 2016. "Democracy and growth: Evidence from a machine learning indicator," European Journal of Political Economy, Elsevier, vol. 45(S), pages 85-107.
    18. Madeeha Gohar Qureshi & Eatzaz Ahmed, 2012. "The Inter-linkages between Democracy and Per Capita GDP Growth: A Cross Country Analysis," PIDE-Working Papers 2012:85, Pakistan Institute of Development Economics.
    19. Zuazu, Izaskun, 2019. "The growth effect of democracy and technology: An industry disaggregated approach," European Journal of Political Economy, Elsevier, vol. 56(C), pages 115-131.
    20. Paul Pelzl & Steven Poelhekke, 2023. "Democratization, leader education and growth: firm-level evidence from Indonesia," Journal of Economic Growth, Springer, vol. 28(4), pages 571-600, December.
    21. Bougharriou, Nouha & Benayed, Walid & Gabsi, Foued Badr, 2019. "The democracy and economic growth nexus: Do FDI and government spending matter? Evidence from the Arab world," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 13, pages 1-29.
    22. Wu, Jiabin, 2017. "Political institutions and the evolution of character traits," Games and Economic Behavior, Elsevier, vol. 106(C), pages 260-276.

    More about this item

    Keywords

    democracy; economic development; modernisation theory; survey;
    All these keywords.

    JEL classification:

    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:lus:reveco:v:71:y:2020:i:2:p:135-167:n:3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.