Ghosal, Sayantan and Proto, Eugenio (2008) Democracy, collective action and intra-elite conflict. Working Paper. Coventry: University of Warwick, Department of Economics. (Warwick economic research papers).

Preview

PDF WRAP_Ghosal_twerp_844.pdf - Requires a PDF viewer such as GSview, Xpdf or Adobe Acrobat Reader Download (272Kb)

Abstract

This paper studies the conditions under which intra-elite conflict leads to a democracy. There are two risk averse elites competing for the appropriation of a unit of social surplus, with an ex-ante uncertainty about their future relative bargaining power, and a large non-elite class unable to act collectively. We characterize a democracy as consistng of both franchise extension to, and lowering the cost of collective political activity for, individuals in the non-elite. In the absence of democracy, the stronger elite is always able to appropriate the entire surplus. We show that in a democracy, the newly enfranchised non-elite organize and always prefer to form a coalition with weaker elite against the stronger resulting in a more balanced surplus allocation between the two elites. Accordingly, the elites choose to democratize if they are suffciently risk averse. Our formal analysis can account for stylized facts that emerge from a comparative analysis of Indian and Western European democracies.

Item Type:	Working or Discussion Paper (Working Paper)
Subjects:	H Social Sciences > HD Industries. Land use. Labor > HD61 Risk Management
Divisions:	Faculty of Social Sciences > Economics
Library of Congress Subject Headings (LCSH):	Conflict management, Democracy, Economic development, Coalitions, Risk management
Series Name:	Warwick economic research papers
Publisher:	University of Warwick, Department of Economics
Place of Publication:	Coventry
Date:	February 2008
Number:	No.844
Number of Pages:	39
Status:	Not Peer Reviewed
Access rights to Published version:	Open Access
References:	[1] Acemoglu, D., G. Egorov and K. Sonin, (2007) Coalition Formation in Nondemocracies, mimeo MIT [2] Acemoglu, D., S. Johnson, J. Robinson and P. Yared, (2005). "Income and Democracy", MIT, Mimeo. [3] Acemoglu, D, and J. Robinson , 2000. Why did the west Extend the Franchise? Democracy, Inequality and Growth in Historical Perspective, The Quarterly Journal of Economics CXV, 1167-1199. [4] Acemoglu, D. and J. Robinson , 2001. A Theory of Political Transitions, American Economic Review, Vol. 91,938-63. [5] Acemoglu, D, and J. Robinson, 2006. Economic Origin of Dictatorship and Democracy, Cambridge Univ. press. [6] Acemoglu, D, and J. Robinson, 2006, "Persistence of Power, Elites and Institution" mimeo. [7] Ake, C., 1985, Political Economy in Nigeria, Longman, London and Lagos. [8] Aidt T. S. , J. Dutta and E. Loukoianova Democracy comes to Europe: Franchise extension and fi�scal outcomes 1830�-1938�, European Economic Review, 50, 249�283 [9] Aminzade, R., 1993, Ballots and Barricades: Class Formation and Republican Politics in France, 1830-1871, Priceton Univ. Press. [10] Anderson, M.S., 1972. The Ascendancy of Europe, 1815-1914, Longman-London. [11] Beattie, A., 1970, English Party Politics, Vol 1, Weidenfeld and Nicholson. [12] Bardhan, P. , 1984. The Political Economy of Development in India, Oxford University Press. [13] Barro, R. J. (1999) The Determinants of Democracy, Journal of Political Economy, 107, 158-183. [14] Bertocchi, G. and Spagat, M. (2001). The politics of cooptation . Journal of Comparative Economics, vol. 29, pp. 591�607. [15] Boix, C., and S. Stokes, 2002, Endogenous Democratization: A Critique, Manuscript, University of Chicago. [16] Bueno de Mesquita, B., A. S. Smith, A. R. Siverson, and J. Morrow 2003, The Logic of Political Survival, The MIT Press. [17] Brass, P. R. 1994. The politics of India since independence / Paul R. Brass. Cambridge : Cambridge University Press, 2nd Ed. [18] Charness, G. and M. Jackson, 2007, "Group Play in Games and the Role of Consent in Network Formation," mimeo, forthcoming Journal of Economic Theory. [19] Conley, J.P. and A. Temini, 2001. "Endogenous Enfranchisement When Groups Preferences Conflict", Journal of Political Economy, Vol. 109, no 1, pp. 79-102. [20] Collier, R. B. 1999, Paths Toward Democracy: The Working Class and Elites in Western Europe and South America, Cambridge University Press. [21] Dahl, R. A. 1989, Democracy and its Critics, Yale University Press [22] De Mello, L. and E. Tiongson (2003). "Income Inequality and Redistributive Government Spending". IMF Working Paper 314. [23] Diamon L.J., 1992. Economic Development and Democracy Reconsidered, American Behavioral Scientist, 35, 450-99. [24] Elwitt, E. 1975, The Making of the Third Republic, Louisiana State University Press. [25] Eptsein, L. E. 1967, Political Parties in Western Democracies, Pall Mall Press. [26] Forrest, T., 1993, Politics and Economic Development in Nigeria, Westview press, Boulder. [27] Fleck, Robert K., and F. Andrew Hanssen, 2002. The Origins of Democracy: A Model with Application to Ancient Greece, Working paper, Montana State University. [28] Galor, O. and O. Moav, 2002. Das Human Capital, forthcoming Review of Economic Studies [29] Glaeser, E., G. Ponzetto, and A. Shleifer, 2005, Why Does Democracy Need Education?, Mimeo, Harvard University. [30] Harsanyi, J. C and R. Selten, 1988, A General Theory of Equilibrium Selection in Games, MIT Press. [31] Hermet, G. , 1978, Elections without Choice, Mcmillian Press. [32] Horowitz D.L. 1985, Ethnic Groups in Conflict, University of California Press. [33] Justman, M. & Gradstein, M. 1999. "The Industrial Revolution, Political Transition, and the Subsequent Decline in Inequality in 19th-Century Britain," Explorations in Economic History, Elsevier, vol. 36(2), pages 109-127, April. [34] Kohli, A., 2001. The Success of India's Democracy, Cambridge Press. [35] Lipset, S. M. (1959) Some Social Prerequisites for Democracy: Economic Development and Political Legitimacy, American Political Science Review, 53, 69-105. [36] Lizzeri, A. and N. Persico, 2004. Why Did the Elites Extend the Suffrage? Democracy and the Scope of Government, With an Application to Britain's Age of Reform, The Quarterly Journal of Economics 119(2), May 2004, pp. 707 - 765. [37] Llavador, H. and R. J. Oxoby, 2005. "Partisan Competition, Growth and the Franchise", The Quarterly Journal of Economics, August 2005, 1155-1189 [38] Luebbert , G. 1991. Liberalism, Fascism or Social Democracy: Social Classes and the Political Origin of Regimes in Interwar Europe, New York, Oxford University Press. [39] McAdam, D. 1982, Political Process and the Development of Black Insurgency. Chicago, Chicago Univ. Press. [40] Merltzer A.H. and S.F. Richard 1981, "A Rational Theory of the Size of Government" Journal of Political Economy, IXIX, pp. 914-927. [41] Moore, B., 1966. Social Origins of Dictatorship and Democracy, Penguin Books, New York. [42] O'Donnel, G., 1973. Modernization and Bureaucratic Authoritarianism: Studies in South American Politics, University of California, IIS. [43] Olaloku, F. et al. 1979, Structure of Nigerian Economy, The Macmillian Press. [44] Oliver, P. E., G. Marwell, and R. Teixeira (1985): A Theory of the Critical Mass. I. Interdependence, Group Heterogeneity, and the Production of Collective Action, American Journal of Sociology, 91(3), 522�56 [45] Olson, M., 1965, The Logic of Collective Action; Public Goods and the Theory of Groups; Harvard University Press. [46] Olson, M., 1993, "Dictatorship, Democracy and Development" American Political Sciences Review , 87, pp. 567-75. [47] Persson, T. and G. Tabellini, 2006, "Democratic Capital: the Nexus of Political and Economic Change", NBER Working Paper 12175. [48] Przeworski, A,. 1997, Transition to Capitalistic Democracy as a Class Compromise in Class and Elites in Democracy and Democratization, Edited by Eva Etzioni-Haley [49] Przeworski, A., J. A. Cheibub, and F. Limongi , 2000, Democracy and Development: Political Institutions and Well-Being in the World 1950-1900, Cambridge University Press. [50] Rashiduzzaman, M., 1982. "East-West Conflicts in Pakistan: Bengali Regionalism, 1947-1970, in A.J. Wilson and D. Dalton, 1982, The States of South Asia, problems of national integration, C. Hurst & Company, London. [51] Rousseau, Jean-Jacques, 1754. Discourse on the Origin and Basis of Inequality Among Men (Discours sur l'origine et les fondements de l'inégalité parmi les hommes). [52] Rudolph, L.I. and S.H. Rudolph, 2001, "Redoing the Constitutional Design: from an Interventionist to a Regulatory State", in Kohli, A., 2001. The Success of India's Democracy, Cambridge Press. [53] Sarkar, S., 2001, "Indian Democracy: the Historical Inheritance" in Kohli, A., 2001. The Success of India's Democracy, Cambridge Press. [54] Sen, A., 1995, "Wrongs and rights in development", Prospect, Issue 1, 1995-10-20. [55] Smellie, K.B., 1949 A History of Local Government, George Allen & Unwin. [56] Tarrow, S. 1998, Power in Movement, Cmbridge Univ. Press. [57] Tilly, C., 1978, From Mobilization to Revolution, Reading, Mass.: Adison-Wesley. [58] Weiner, M., 1999 "The Struggle for equality: Caste in Indian Politics", in Kohli, A., 2001. The Success of India's Democracy, Cambridge Press. [59] Wende, P. 1999 "1848: Reform or Revolution in Germany and Great Britain" in Reform in Great Britain and Germany 1750-1850, edited by T.C.W. Blanning and Peter Wende. Proceedings of British Academy, 100. Oxford University Press, Oxford, U.K. Press. , Cambridge Press. [60] Young, H. P., 1993, The Evolution of Conventions, Econometrica, 61 , 57-84.
URI:	http://wrap.warwick.ac.uk/id/eprint/1371

Request changes to a record

Actions (login required)

View Item