Political Science: Introduction and State Theory (PDF)

1. INTRODUCTION 1. THE SCIENCE IN POLITICAL SCIENCE 1. PHILOSOPHICAL/ NORMATIVE V POSITIVE APPROACH many topics part of political science also dealt with by philosophy o normative political theory: how things ought to be → assumptions about what is just to make logical claims ab...

1. INTRODUCTION 1. THE SCIENCE IN POLITICAL SCIENCE 1. PHILOSOPHICAL/ NORMATIVE V POSITIVE APPROACH many topics part of political science also dealt with by philosophy o normative political theory: how things ought to be → assumptions about what is just to make logical claims about political institutions o political science: how things are and how things work in practice 2. POLITICAL SCIENCE AS A MODELLING SCIENCE some disciplines (i.e., history) focus on giving accurate account of specific events and situations other disciplines (i.e., anthropology) document the meaning that humans attribute to social life political science (not unlike economics): focus on looking at stylized, bare bones representations of reality o strip situations of their names, contexts, accidental features o as Przeworski famously said: replace country names with values of variables o e.g. no more relationship between Sweden and Sudan but relationship between variables MODEL≠ REALITY → WHY OVERSIMPLIFICATION? a 1:1 map of a territory is completely useless because it’s unmanageably large which details to include in the representation depends on question asked EXAMPLE: a subway train - engineer that designs brakes can represent train as point mass and attrition coefficient → “what about the habits, the dreams, the ambitions, the worries, of people who take the train every day?” → omitting them does not mean engineers hate people they have a different goal - urban planner who needs to design schedules might care about people habits - advertisement professional might care about dreams and ambitions 3. WHAT ARE INSTITUTIONS? multiple (sometimes confusing) meanings and usages DEFINITION: “institutions are the humanly devised constraints that structure political, economic and social interaction. They consist of both informal constraints (sanctions, taboos, customs, traditions, and codes of conduct), and formal rules (constitutions, laws, property rights).”(North, JEP 1991) → in this course we consider institutions mostly rules of the game that map individual actions into outcomes EXAMPLE: - electoral system is an institutions 1 1. THE SCIENCE IN POLITICAL SCIENCE - electoral system maps count of individual marks on ballots into seat allocation in legislature - constitution maps a politician’s decision into consequences (e.g., new tariffs on China) vs. nothing (e.g., that specific official has no powers over trade policy) - legislature rules decide whether floor can amend bill sent by committee or vote with closed rule → different ways of counting the votes produce different electoral outcomes 4. MAIN APPROACHES IN POLITICAL SCIENCE 3 MAIN APPROACHES TO POLITICAL PHENOMENA INSTITUTIONALIST: explanatory leverage from understanding how rules shape outcomes STRUCTURAL/MATERIALIST: explanatory leverage from understanding conflict over physical resources (e.g., income, wealth) → institutional rules reflect a balance of power in societies CULTRUAL/PSYCHOLOGICAL: behavior affected by shared understandings (e.g., identities) and by (hardwired) cognitive/emotional processes → values and biases: an example is economic voting → current mainstream is (a relatively sound) synthesis of the three 2. THE STATE 2. THE STATE 1. WHAT IS A STATE MAX WEBER: the state cannot be defined in terms of its ends and goals: e.g. colonial apparatus the state cannot be defined in terms of its task: no task exclusive and peculiar to the state → e.g. state companies ultimately, one can define the modern state only in terms of the specific means peculiar to it: the use of physical force DEFINITION: a state is an organization that successfully claims the monopoly of the legitimate use of physical force within a given territory CONTRACTARIAN VIEW of the STATE society (and society vs. state) based on “social contract”: sign away autonomy in exchange for order → it is not a real contract but just a promise because it is not enforceable questions: how many of you signed this contract? where do I go to have it enforced? are there severance provisions? did North Koreans also sign it? German Jews in the 1930s? EXAMPLE of social contracts: Medieval coniuratio → yet useless tool if goal is understanding state behavior in real world → PROBLEM: collective action problem in large groups (millions of people would have to sign) 2. THE STATE AS A BANDIT state can use coercion to extract resources: a state powerful enough to provide “law and order” also strong enough to plunder → question: why doesn’t the state take everything? ROVING BANDITS: specialized groups who have coercion resources to take what they want and move on → no incentives for population to invest and increase production because they expect to be stolen → in the end bandits do not have nothing to steal STATIONARY BANDITS: RATIONAL MONOPOLIZATION OF THEFT bandits/warlord can decide to settle set “tax rate” such that people produce more: you have to incentivize people to produce more in order to continuously extract resources → more to steal later element of predictability → population strictly prefers stationary to roving bandit 1 2. THE STATE LAFFER CURVE - tax rate = 100% : the total production of the society would be 0 because they know they cannot keep anything for themselves - tax rate = 0 : people are going to produce as much as they can → the more you tax people the less they are going to produce - if I tax 100 I cannot keep anything because the production is 0 - if I tax 0 I cannot keep anything because people are keeping everything to themselves → there is a interior point where revenues are maximized - The stationary bandit cannot only tax: they have to provide one public good: security = no roving bandits - The stationary bandits also might realize that if there are better infrastructure, if people have better health, if they are more educated than their people would produce more → stationary bandits might want to provide also these services → parallel with the “invisible hand”: as I do not get my lunch thanks to the benevolence of the baker, I do not get my health or education by the benevolence of the State but because the State is self- interested THE STATE AS STATIONARY BANDITS public good provision: a continuum from 1. basic order / physical integrity 2. contract enforcement and property rights 3. infrastructure 4. health and education 2. THE STATE → incidental to the revenue-seeking behavior of the dictator: only invest in public goods to the point in which marginal revenue equal marginal cost GRASPING HANDS → can think of stationary bandit as “selling” order (or other public goods) in exchange for revenues revenues first increase, then decrease with tax rate → disincentive to produce and invest dictator charges monopoly price not the welfare-maximizing price and quantity → this exchange might not be in the population best interest 3. DISCOUNTING THE FUTURE If the bandit is impatient and only values the present, they will try to steal everything they can in the shortest time → they behave like roving bandits and have no incentive to behave differently with a short time horizon perspective → EXAMPLE: if kicked out next year → expropriate any asset whose value is less than its year-long yield If the bandit is more patient they will wait for the output of people’s investments to steal that → investment requires o assigning value to future vs. present consumption o belief that fruits of investment can be reaped → it is better to give the bandit a long term horizon: explains why dynastic succession emerges: the dictator does not only think about his office but also of that of his family → promise of no expropriation not a credible commitment as there is no commitment device and no outside enforcement DEMOCRACY AND DICTATORSHIP If the bandit behave like monopolists → use democracy as competition between “candidate stationary bandits” We can have competition for who is going to be the bandit: democratic political leaders are as self-interested as the stationary bandit want to obtain majority support: candidate needs to “buy” 50%+1 of population tax rate is below the revenue-maximizing one: o the candidate has to offer some bundle to voters → if bandits are competing with each other then they will outbid each other until they reach the best possible deal o the deal needs to be a good one because in the end they will steal from the people so they have to compensate the narrower the interest, the less it will take into account social costs of redistribution to itself: it does not come from benevolence, just by the willing to be the bandit 2. THE STATE → we have to think of democracy as a market to become the dictator: the dictator behaves better under democracy because he is competing with others and these candidates try to outbid each other 4. OLSONIAN DEMOCRACY Olson, Mancur. 1993. “Dictatorship, Democracy, and Development.” American Political Science Review87 (03): 567-576 PROBLEM OF CREDIBILITY: promises of autocrat suffer from problem of credibility of commitment: the state does not have any way to prevent the non fulfillment of promises in the case of single stationary bandit there is no compliance problem because the bandit is choosing the tax rate that maximizes its own utility in the case of democracy you have a problem: in order to be elected the bandit is promising something that is not optimal from their point of view so they are incentivized to not keep their promises once in control → democracy (as simple elite selection device) needs rules, institutional frameworks, adjudication and enforcement that make it costly to not abide to the promises → byproducts of democracy: rules about property rights and contract enforcement → democracies guarantee more freedoms to individuals beyond those required to simply have competitive elections : they are not required to make democracies work but they are byproducts → Democracies tend to have better economic performance in the long run because they provide a more stable environment for investment and economic activity What happens if I lose the election but I still want to be the bandit? Example: Lybia → this happens because the machinery of the state is weak and could be easily taken over 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE: STATIONARY BANDITS AND TAXATION IN CONGO 1. CHARLES TILLY The modern administrative state is ultimately an unintended concept of the need for feudal lords to make war: It is very expensive to pay for the devices you need to make war so you need to efficiently collect revenues to sustain the expenses → Administrative states are put in place because you have to pay back the money you borrow to pay for the weapons → TILLY: states make wars, wars make states There is a tension between making money and making war: states that are mostly war machines and do not nurture their market enough are not very prosperous and vice versa In the long run of history the states that survive and prevail are those you find the right mix between militarism and capitalism pure capitalist states (e.g., Republic of Venice) and pure military empires succumb to states with “the right mix” (e.g., France) Marxist tradition: the state just “executive committee” of the bourgeoisie → go beyond this concept and started thinking about relative autonomy: the state has its own interest to peruse which does not coincide with that of the civilian “militaristic” tradition (Carl Schmitt) : share the view that military power is the foundation of the state and this precedes every societal needs Tilly idea is that states do 4 things: under the general heading of organized violence, agents of states characteristically carry on four different activities: 1. war making: eliminating or neutralizing rivals outside main territories → if you don’t you are going to be absorbed by them 2. state making: eliminating or neutralizing rivals inside main territories → through military and police 3. protection: eliminating or neutralizing enemies of clients / allies 4. extraction: acquiring means of carrying out war making, state making, and protection à finding the money: the state becomes a revenue collection apparatus 1 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE 2. PAPER: SANCHEZ DE LA SIERRA 1. SUMMARY Research Question: How do economic incentives and resource attributes shape the emergence of state-like functions (taxation, protection,monopoly on violence) by armed actors in regions with weak state presence? Motivation: o States emerged relatively late in history, and their core functions were likely key drivers of modern economic growth o The functions of the state may have their roots in the actions of armed groups, some of which evolved into states while others became organized crime o The lack of systematic data from pre-state societies makes it difficult to statistically analyze the origins of state functions → Empirical study of state formation in Olsionian way: understand bandits incentives to change from being just militias and become stationary and set up and administrative state Context: The study focuses on the Democratic Republic of the Congo (DRC): o central government's control is limited and various armed actors operate → observe the formation of state-like functions Theoretical Framework: o theory of optimal taxation: type and value of economic activity influence the incentives for armed actors to establish state functions o Observable Production (e.g., coltan): - Increase the returns to taxing production directly - Incentivize the provision of protection at production sites o Unobservable Production (e.g., gold): a higher value of output is hypothesized to: - Increase the returns to taxing people and their consumption - Incentivize the creation of administrative for the collection of more complex taxes Empirical Strategy: o Data: Panel dataset on armed actor behavior and economic activity o Exploits: - Coltan Shock (2000): Playstation II announcement led to a surge in coltan demand and prices as it used coltan as an input - Gold Shock (Post-2006): With global recession investors seeked gold as a safe haven, driving up gold price Main findings: o Coltan price shocks lead to the emergence of state-like functions at mining sites, driven by non-state armed actors → dismantling of fiscal and judicial administrations in villages associated with coltan mining o Gold price shocks lead to the emergence of stationary bandits in villages → introduce working permits and more complex taxation systems and develop fiscal and judicial administrations to support these efforts 0 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE → the choice of tax revenue generation methods is influenced by the opportunity costs associated with different activities o When stationary bandits affiliated with local communities or the Congolese army prioritize the population's well-being their presence positively impacts household welfare, especially in response to price shocks 2. BACKGROUND Congo mines: o Artisanal mining in isolated forest village areas o Miners face various challenges, including exploitation by armed groups, lack of safety regulations, and limited access to formal markets o 2 main minerals: - Coltan: bulky and voluminous mineral, difficult to conceal → easier for armed groups to observe and tax its production at mining sites or during transportation - Gold: high value-to-weight ratio, ease of concealment → difficult to tax directly Shock to mineral prices: o Coltan Shock: - demand surge driven by its use in electronics - supply rigidity in the short run due to limited production capacity outside the DRC → price increase o Gold Shock: - 9/11 attacks: global economic downturn and increased uncertainty - Investors flocked to gold as a safe-haven asset → price increase Congo Country Configuration Distance and Supply Chains: the significant distance between mining sites and support villages creates logistical challenges and opportunities for armed groups to control different points in the supply chain Example: Nduma Defense of Congo-Renouvelé (NDC-R) NDC-R's: militia group formed in 2008 which consisted of 2,377 combatants and administrators controlling 108 villages and taxing 38,480 people through a range of weapons. Taxation and Revenue Generation: - financed by collecting monthly poll tax - issued mining permits, collected mining output taxes, agricultural tax (ration militaire), and fees on public property (taxe domaniale) - collected toll fees on transit and turnover tax on businesses - intelligence agency monitored traders and enemy activities for taxation - administered profits from monopolies over sale of beer, liquor, cigarettes - created legal system penalizing sexual offenses, tax evasion, espionage, and theft 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE - civilian relations agency conducted sensibilization campaigns to inform and persuade population, obtain voluntary recruits: propaganda machine - general invoked ancestors of local ethnic group for legitimacy → Takeaway: The NDC-R example illustrates how armed groups in conflict-ridden regions can evolve into complex organizations with state-like functions, driven by the need to secure resources, maintain control, and gain legitimacy 3. MODEL 1. Two Economies: o Production Economy: workers produce goods or services, generating output o Consumption Economy: households utilize their labor income from the production economy for both consumption and investment (wealth) 2. Roving Bandits: regularly engage in the expropriation of output or wealth from both economies 3. Emergence of a Monopoly on Violence: o An armed actor (potentially one of the roving bandits) establish a monopoly on violence o This monopoly allows the actor to implement a credible system of taxation 4. Taxation Strategies: o Production Economy: taxes on both the output produced and the labor involved o Consumption Economy: tax the returns on investments made by households 5. Tax Evasion and Administration: o Households have the option to evade taxes o The armed actor can establish an administration to increase the cost of tax evasion 6. Armed Actor's Objective: maximize a combination of their own revenue from expropriation (taxes) and the overall welfare of the population under their control → trade-off IMPLICATIONS OF THE MODEL Monopolies of violence in production economies: when the output price is high, the potential for revenue extraction increases, incentivizing armed actors to establish monopolies Role of observability and shipping: easier for armed groups to control and tax the production of resources that are hard to hide (coltan) and have to be transported through specific routes (airports) → easier monitoring and control of the flow of goods, facilitating taxation Monopolies in consumption economies: the richer the village, the greater the potential for taxing wealth in circulation Armed actor's motivations and welfare: If the actor values the well-being of the population, they are more likely to implement policies that benefit the people, leading to a more positive outcome (e.g. providing protection, maintaining order, or investing in public goods) Fiscal administration in consumption economies: direct taxation of production may be challenging → establish a fiscal administration for increasing revenue, enforce tax collection and reduce evasion 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE 4. DATA AND EMPIRICAL STRATEGY Sample: 239 villages and their associated 411 mining sites in eastern DRC, Data Collection: historical reconstruction by local experts to create a detailed yearly history of each village, validated and supplemented with household surveys Timeframe and Scope: - period from1995 to 2013 to include mineral price shocks and their aftermath. - Include municipalities with various resources and a matched sample of agricultural municipalities for control Outcome Variables: - Output taxation: presence and extent of taxes imposed on production - Presence of stationary bandit: presence of monopoly on violence and control - Security services: provision of protection services by armed actors - More sophisticated taxes: implementation of complex tax systems - Creation of fiscal and judicial administration 5. IDENTIFICATION STRATEGY Empirical strategy: test the hypothesis that increased economic prosperity in a region leads to a higher likelihood of armed actors settling and creating state-like functions → in particular in situations when it's difficult for people to hide their wealth Addressing Endogeneity: using local mineral prices directly might lead to biased results because these prices could be influenced by the presence or actions of armed groups themselves → overcome endogeneity issue use US mineral prices: - The DRC's share of global gold production is negligible, so any local events wouldn't affect the US gold price - The fluctuations in coltan prices in 2000 were primarily due to external factors → exogenous event, independent of the actions of armed groups in the region Reduced-Form Specification 𝑈𝑆 𝑈𝑆 𝑌𝑗𝑡 = 𝛽𝑡 + 𝛼𝑗 + 𝛾𝑐 𝐺𝑗𝑡 𝑝𝑔,𝑡 + 𝛾𝑡 𝐶𝑗𝑡 𝑝𝑐,𝑡 + 𝜀𝑗𝑡 where: - 𝑌𝑗𝑡 : outcome of interest (e.g., presence of a stationary bandit, implementation of taxes) in municipality 'j' at time 't'. - β𝑡 and α𝑗 : year and municipality fixed effects - 𝐺𝑗𝑡 and 𝐶𝑗𝑡 : indicate whether the municipality has coltan or gold resources - 𝑈𝑆 𝑝𝑔,𝑡 and 𝑝𝑐,𝑡 𝑈𝑆 : represent the US prices of coltan and gold at time 't'. - γ𝑐 and γ𝑡 : impact of changes in US coltan and gold prices on the outcomes in municipalities with those respective resources 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE 6. RESULTS Legend: - Black (solid line): proportion of coltan-based villages attacked - Dash (dashed line): proportion of gold-based villages attacked - Dot (dotted line): proportion of all villages attacked 1. Conflict: violent attacks Timeline: 1999: The coltan price surges due to increased demand for the Playstation II. 2005: Some stability returns to mineral prices after the initial coltan boom. 2010: A second shock to the coltan price occurs. Observations and Interpretations: Coltan Boom and Increased Attacks: sharp rise in attacks on coltan-based villages coinciding with the coltan price surge in 1999 → "rapacity effect" hypothesis: as villages become wealthier due to the coltan boom, they become more attractive targets for roving bandits Gold Villages and Limited Attacks: the increase in attacks on gold-based villages is less pronounced, even during periods of high gold prices → gold's ease of concealment makes it less susceptible to direct theft, reducing the incentive for roving bandits to attack → importance of resource attributes in shaping the behavior of armed actors 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE 2. Taxes on mineral production Observations Coltan price taxation: when the price of coltan increases (vertical lines corresponding to the 2000 and 2010 price shocks), there's a subsequent rise in taxes imposed on its production → higher output prices create stronger incentives for armed actors to tax production directly → this taxation involves setting up checkpoints or "customs" to inspect coltan being transported Coltan vs. Gold: less pronounced increase (or even a decrease) in taxes on mineral production in areas where gold is the primary resource, even during periods of high gold prices → resort to alternative methods like entry fees or "working permits" → the type of mineral resource and its characteristics influence the taxation strategies adopted by armed actors → adaptability 3. Security service Provision of security services in: - Left Plot: Mines - Right Plot: Support villages (where miners’ families reside) Trends in Security Provision at Mines (Left Plot): Coltan Boom and Security: provision of security services at coltan mines increases sharply around the year 2000 (coltan price surge) → as the value of coltan production rises, armed groups have a greater incentive to provide security at the mines Gold Mines and Security: less pronounced or even a decline in security provision during periods of high gold prices 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE Trends in Security Provision in Villages (Right Plot): Rise in Security with Gold Boom: increase in security provision in villages, particularly those associated with gold mining, coinciding with the rise in gold prices after 2006 → control the areas where miners spend their income because direct taxation of gold production is challenging Implications: Stationary Bandits and State Formation: The increase in security provision in both mines and villages, particularly in response to price shocks, supports the idea that armed groups become more "stationary" as resource values increase Response to International Prices: The behavior of armed groups is directly influenced by changes in international mineral prices → vulnerability to external economic shocks → economic incentives, driven by resource prices, play a crucial role in shaping the actions of armed groups and their potential evolution into state-like entities 4. Explaining the Rise of Taxes on Production, Stationary Bandits, and Protection Mine 1st Column (Municipality Attacked): a rise in coltan's value increases the probability of attacks on municipalities (positive, significant) → "rapacity effect” 2nd Column (Customs Tax) + 3rd Column (Entry Fees): - as coltan's value rises, so does the likelihood of implementing customs taxes (positive, significant) but no influence on the implementation of entry fees (non-significant) - changes in gold prices don't have a direct impact on the use of customs taxes (non-significant) but when gold prices increase, the use of entry fees (or work permits) also rises (positive, significant) → Higher resource prices generally lead to increased efforts to capture resource rents, either through conflict (attacks) or through various forms of taxation or fees → The type of mineral resource influences the specific revenue extraction mechanisms 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE Village Stationary Bandit (7) + Security Service (8): - as gold prices rise, the likelihood of a stationary bandit establishing themselves in the village and of security services being present increases (positive, significant) → focus on controlling the areas where the resource wealth is spent rather than the extraction sites themselves - coltan price fluctuations don't directly influence the presence of stationary bandits neither the provision of security services in villages (non-significant) 5. Explaining the intensification of the essential functions of the state Fiscal and judicial administrations Coltan: as coltan becomes more valuable, there's a decrease in the likelihood of establishing fiscal and judicial administrations in the village (negative, significant) → valuable, easily transportable resources incentivize extraction directly at the mine, reducing the need for complex fiscal structures in villages Gold: as gold becomes more valuable, there's an increased incentive to establish fiscal and judicial administrations in the village (positive, significant) → gold might lead to more economic activity and transactions within the village, necessitating fiscal mechanisms for taxation and revenue collection → the type of resource and its price can influence the development of state-like functions (fiscal and judicial administration) in villages 3. PAPER: SANCHEZ DE LA SIERRA – ON THE ORIGINS OF THE STATE 7. CONCLUSIONS Summary of Findings: Coltan Price & State-like Functions: o An increase in coltan price is associated with the emergence of stationary bandits at coltan mines o These bandits establish a monopoly of violence and engage in revenue extraction primarily through customs taxation and providing protection at the mines → Coltan's high value and difficulty to conceal incentivize control and taxation at the mines, leading to a reduction in administrative presence in villages Gold Price & Alternative Revenue Capture: A rise in gold price leads to o At production sites: introduction of daily mining-work visas and labor taxes at production sites (mines) o In support villages: Emergence of stationary bandits who tax the local economic activity and develop more sophisticated fiscal administration. → Gold's concealability makes direct taxation at mines challenging, shifting the focus of bandits to villages where gold-related economic activity occurs → the paper demonstrates how the nature of the resource (concealability and value) shapes the strategies of armed actors and the locations where they establish control and rudimentary state- like functions UNDERSTAND OLSON “benevolent dictator”: abstraction to evaluate welfare properties of policies → now called “social planner”: if I can do whatever I want how would I choose if I want to make the people better off → maximize social welfare “predatory state”: pessimistic empirical generalization based on the experience of post colonial states “developmental state”: optimistic view of intervention or planning → having a state is key for prosperity and the ultimate objective of the state is generating prosperity an “invisible hand” mechanism to understand the state not by the benevolence of the dictator, but by their self-interest, I receive public goods “the rational, self-interested leader of a band of roving bandits is led, as though by an invisible hand, to settle down, wear a crown, and replace anarchy with government”  2. DICTATORSHIP AND DEMOCRACY 1. DEMOCRATIZATION I: REDISTRIBUTION 1. MULTIPLE CONCEPTUAL DEFINITIONS OF DEMOCRACY In order to understand variation in how states behave is to use the concept of POLITICAL REGIMES: set of rules that allocate the main powers in society (decide how elites are selected) One main distinction between democracies and non-democracies Competition: o Olson: Democracy is creating some type of comparative market for elites o Schumpeter: central element is teams of politicians competing for power to make policy and support from the masses - citizens’ influence stops after elections - minimal requirements of freedom to campaign and dispatch proposals to ensure that competition is real Responsiveness (Dahl): democracy is a system that assigns equal weight to the policy preferences of every citizen → ideal type o Distinction between ex ante and post equal weight: WHAT DEMOCRACY IS NOT - democracy is liberty - democracy is social equality - democracy is good governance - democracy is justice - democracy is equal representation - democracies are pro-Western → all these assume the answer to otherwise interesting empirical questions - do democracies guarantee freedoms? - do democracies lead to more equitable outcomes? - do democracies treat citizens as equals? - do democracies govern better? PRZEWORSKI ET AL.’S DEFINITION: DISTINGUISH DEMOCRACY AND NON-DEMOCRACY - central element is contestation - democracy is a system in which ruling parties lose elections → e.g. Bashar Assad vote share 2014: 88.7% → Syria is not a democracy - elections determine chief executive and legislative body - not legally constrained to respond to power not resulting from electoral process 1.2. PAPER: BOIX (2003) – THEORY OF POLITICAL TRANSITION TRANSITOLOGY focus of older “transitology” and “breakdown of democratic regimes” lit: o short-term strategies of main political actors o institutional design contemporary view revolves around o redistribution o commitment problems current approach more structuralist than institutionalist proper o closer to even older long-run “economic history” type of arguments o e.g., Barrington Moore “The Social Origins of Dictatorship and Democracy” Boix (2003) precedes Acemoglu & Robinson (2005) “The Economic Origins...” → same logic and ingredients, slightly less elegant/general... 1.2. PAPER: BOIX (2003) - THEORY OF POLITICAL TRANSITION 1. INTRODUCTION Core Argument: Lack of a robust model explaining the conditions under which different political regimes arise (democracies, right-wing authoritarian regimes, left-wing dictatorships) Model Outline: Two-step approach: 1. Model an economy where individuals varying capital endowment and capital mobility and analyze how different political regimes impact the distribution of wealth. 2. Examine how these distributional consequences shape the strategies of political actors in choosing a regime. Key Findings: Democracy can happen if inequality decreases to a point where the wealthy are no longer better off trying to block redistribution with authoritarianism Higher capital mobility increases the likelihood of democracy: As capital becomes more mobile, taxes in democracies tend to decrease to prevent capital flight, making democracy less costly for the wealthy compared to authoritarianism. The balance of power influences regime choice: - The mobilization of the poor raises the costs of repression for the rich. - In moderately unequal societies, the strengthening of the lower classes accelerates democratization. - In highly unequal societies, it may lead to revolutions and civil wars. Motivation: Explain the historical emergence of democratic events across different periods and regions: - prevalence of quasi-democratic structures in ancient Athens and certain medieval European cities - democracy in some agrarian economies (e.g., Norway) but failed in others with powerful landowners - existence of authoritarian regimes in wealthy oil-producing states. explains the wave-like pattern of revolutions and regime shifts in history. 1.2. PAPER: BOIX (2003) – THEORY OF POLITICAL TRANSITION 2. THE INITIAL DISTRIBUTION OF ASSETS AND THE DEMAND FOR REDISTRIBUTION Model Setup: Two types of individuals: Poor (majority) and wealthy (minority) Capital: - Poor's total capital endowments: 𝐾𝑝 - Wealthy's total capital endowments: 𝐾𝑤 - Total capital stock: 𝐾 = 𝐾𝑝 + 𝐾𝑤 - Individual capital: 𝑘𝑝 - Poor: 𝑘𝑝𝑖 = (α = proportion of poor population) α 𝑘 - Wealthy: 𝑘𝑤 𝑖 𝑤 = 1−α → 𝑘𝑝𝑖 < 𝑘𝑤𝑖 ∶ the poor have less than the rich because they are more numerous and by construction rich have more capital Capital Specificity (σ): represents the degree to which capital assets are difficult or costly to move out of a country - Higher σ = more specific (immobile) capital, greater loss in value if moved abroad - if you move capital abroad, you lose value y 𝑎 = k(1 − σ) with σ ∈ [0,1] Income: Determined by capital endowment - Constant Return to Scale production function: output normalized as 𝑦𝑝 = 𝑘𝑝 and 𝑦𝑤 = 𝑘𝑤 → what you produce is proportional to the capital you have - income per capita 𝑦̅ = 1 Assumptions: - No commitment: Poor can't commit to low taxes, wealthy can't commit to future redistribution - Independent generations: Each generation makes decisions without considering past or future generations Political Systems: Authoritarianism: Wealthy rule, repress the poor Communism: Poor rule after expropriating wealthy's capital Democracy: Everyone votes on tax rate, property rights protected Revolutionary War: Outcome uncertain, both sides incur costs 1.2. PAPER: BOIX (2003) – THEORY OF POLITICAL TRANSITION 1. Democracy & Redistribution: Taxation: Linear tax (τ) on income, revenue distributed equally Median Voter: Poor individual sets tax rate to maximize their income, considering: - Initial income (from capital) - Net transfer from the government τ2 - Quadratic deadweight loss of taxation : you lose some income when you tax → if taxes 2 are higher people tend to work less and the country becomes poorer → Maximization problem of the median voter: median voter's trade-off in choosing the tax rate: 𝑘𝑝 τ2 (1 max − τ) + τ − 𝜏 α 2 - They want to maximize their income, which consists of their after-tax income from their own capital plus the transfer they receive from the government - They also want to minimize the deadweight loss associated with taxation. Constraint: Wealthy's after-tax income must be at least as high as their income abroad to prevent capital flight (1 − τ) ≥ (1 − σ) Optimal Tax Rate τ∗ = 𝑚𝑖𝑛{1 − 𝑘𝑝𝑖 , σ} - If capital is highly specific (high σ), tax rate is determined by poor agent gain from redistribution (1 - ki_p) - If capital is mobile (low σ), tax rate is constrained by threath of capital flee (σ) → min: choose the smallest between asset specifity and inequality 2. Authoritarianism & Repression: right-wing dictatorship is a dictatorship of the rich No redistribution: - poor are excluded from democracy - optimal tax rate for the rich = 0 Repression cost (ρ): Cost borne by the wealthy to exclude the poor - ρ ∈ {ρ𝑙 , ρℎ } : ρ can be low or high depending on factors like poor's mobilization and wealthy's control mechanisms - rich agent gets 𝑘𝑤 𝑖 −ρ - each poor agent receives just 𝑘ρ𝑖 1.2. PAPER: BOIX (2003) – THEORY OF POLITICAL TRANSITION 3. Revolution & Expropriation: Poor may revolt against authoritarianism Outcome depends on repression cost: - ω : cost of having a war - If wealthy win: ▪ rich get : 𝑦𝑤𝑤𝑎𝑟 = 𝑘𝑤 − ω ▪ poor lose everything: 𝑦𝑝 = 0 - if poor win revolution, communism: ▪ wealthy's immobile wealth confiscated ▪ poor get : 𝑦𝑝𝑤𝑎𝑟 = 𝑘𝑝 + σ𝑘𝑤 − ω → on expectation poor better off under democracy where they can set the tax rate than revolution → rich prefer winning revolution to democracy → Core Idea: The initial distribution of assets and their mobility significantly shape the demand for redistribution and influence the choice of political regime 3. CHOICE OF THE POLITICAL REGIME Political Regimes as a Game: - Game of imperfect information between the wealthy and the poor - Nature's Move: Determines the initial distribution of assets (inequality) and their specificity - Wealthy's Move: Choose to repress (authoritarianism) or not repress (democracy) - Poor's Move: If repressed, choose to revolt or acquiesce. - Payoffs: Depend on the chosen strategies and the outcome of any potential conflict. Information Asymmetry and Conflict: The wealthy know the true cost of repression, while the poor can only estimate it. This information asymmetry can lead to miscalculations and conflict, even when both sides would prefer to avoid the costs of war. Revolutions and civil wars occur when the poor underestimate the wealthy's repressive capabilities, and the wealthy underestimate the poor's organizational strength. 1.2. PAPER: BOIX (2003) – THEORY OF POLITICAL TRANSITION 4. EQUILIBRIUM OF THE GAME 1. Low Levels of Inequality or Asset Specificity Conditions: - Low wealth inequality (the poor own a significant share of the total capital) - High capital mobility (low asset specificity) → Outcome: Stable Democracy Low Redistributive Pressure: Due to low inequality or high capital mobility, the expected tax rate in a democracy (τ*) will be low. Wealthy's Preference: The wealthy, anticipating low taxes, prefer democracy to the costs of repression (ρ) even when repression is cheap. Formula: The wealthy's after-tax income in a democracy (𝑦̂𝑤𝑖 (τ∗ ))is greater than their income under authoritarianism with low repression costs (𝑘𝑤𝑖 − ρ𝑖 ). 𝑦̂𝑤𝑖 (τ∗ ) > 𝑘𝑤 𝑖 − ρ𝑖 𝑒𝑣𝑒𝑛 𝑓𝑜𝑟 ρ = ρ𝑙 2. Medium inequality and specificity Conditions: Moderate levels of wealth inequality and asset specificity. → The wealthy's preference for democracy or authoritarianism depends on the cost of repression → Outcomes: Low Repression Cost: Authoritarianism ▪ The wealthy find it cheaper to repress than to accept the moderate level of redistribution under democracy. ▪ The poor recognize that repression is likely to succeed and choose not to revolt ▪ 𝑘𝑤 𝑖 − ρ𝑖𝑙 > 𝑦̂𝑤𝑖 (τ∗ ) : Wealthy's income under authoritarianism with low repression cost is greater than their after-tax income in democracy High Repression Cost: Democracy ▪ Repression becomes too expensive for the wealthy. ▪ They concede to democracy to avoid potential conflict and the high costs of repression. ▪ 𝑦 ̂𝑤𝑖 (τ∗ ) > 𝑘𝑤𝑖 − ρ𝑖ℎ : Wealthy's after-tax income in democracy is greater than their income under authoritarianism with high repression cost 1.2. PAPER: BOIX (2003) – THEORY OF POLITICAL TRANSITION 3. High inequality and specificity Conditions: - High levels of wealth inequality and asset specificity. - The wealthy strongly prefer authoritarianism to avoid high taxes under democracy. - The poor's potential gains from revolution are still relatively low. → Outcome: Authoritarianism The wealthy choose repressio → 𝑦̂𝑤𝑖 (τ∗ ) < 𝑘𝑤 𝑖 − ρ𝑖ℎ : democracy is costly for the rich The poor, despite their discontent, don't see enough potential benefit from a revolution to risk it, especially given the likelihood of a successful repression → 𝑞(𝑘𝑝 + σ𝑘𝑤 ) < 𝑘𝑝 : poor's expected gain from revolution is less than their income under authoritarianism (q: probability of success of the revolution) 4. Very high inequality and specificity Conditions: - Extreme inequality and immobile assets. - The wealthy have a strong incentive for authoritarianism. - The poor see substantial potential gains from revolution. → Outcomes: Low Repression Cost: Authoritarianism - the wealthy repress → 𝑦̂𝑤𝑖 (τ∗ ) < 𝑘𝑤 𝑖 − ρ𝑖ℎ : democracy is costly for the rich - the poor acquiesce due to the low likelihood of a successful revolution High Repression Cost: Authoritarianism or Conflict - The wealthy can't always repress due to high costs. - They mix their strategies, sometimes repressing and sometimes conceding. - The poor, seeing a potential for success, may revolt, leading to civil war. → 𝑞(𝑘𝑝 + 𝜎𝑘𝑤 ) > 𝑘𝑝 : potential for poor winning → If the poor win, a communist regime is established. → The probability of revolution increases as inequality and asset specificity rise, increasing the potential gains for the poor 1.2. PAPER: BOIX (2003) – THEORY OF POLITICAL TRANSITION 5. IMPLICATIONS 1. Income Inequality Impact on Regime Choice: - Higher inequality → Increased redistributive demands → Higher taxes in democracy → Wealthy favor authoritarianism - Lower inequality → Reduced redistributive pressures → Lower taxes → Wealthy more likely to accept democracy Historical Examples: - Highly unequal societies with immobile assets (land): Democracy unlikely → e.g., Prussia, Russia: Historically dominated by powerful landed aristocracies who resisted democratization to safeguard their vast estates. - Agrarian economies: Democracy is only feasible if here is a relatively equal distribution of land ownership → if not the wealthy landowners would fear expropriation and oppose democracy → e.g., Alpine cantons of Switzerland: with small-scale farming and a egalitarian distribution of land ownership, were able to sustain democratic institutions even in pre- industrial times. - First democratization wave: Coincides with declining inequality → e.g., UK, Denmark, Norway: experienced a decline in income inequality in the decades leading up to their democratic transitions - Spain: ▪ high inequality in the early 20th century: political polarization and the outbreak of the civil war in 1936 ▪ subsequent decline in inequality during the Franco regime: peaceful transition to democracy in the late 1970s 2. Asset Specificity Impact on Regime Choice: - Low mobility/high specificity: Capitalists resist democracy to avoid high taxes - High mobility/low specificity: Voters accept lower taxes, reducing the threat to capitalists, making democracy more likely Historical Examples: - Industrial Revolution: Shift from immobile assets (land) to mobile capital (industry, finance) facilitated democratization because of an increased capital mobility - Global Financial Markets: Increased capital mobility coincided with democratization waves - Pre-contemporary regimes: ▪ Athens: the importance of trade and commerce, with their relatively mobile assets, may have created conditions favorable for democracy - Early moden Europe: the consolidation of larger political units and the dominance of immobile land-based wealth, led to the decline of proto-parliamentary bodies and the rise of absolutist monarchies - Wealthy dictatorships: Oil-rich states remain authoritarian due to the immobility of their resource wealth 1.2. PAPER: BOIX (2003) – THEORY OF POLITICAL TRANSITION 3. Repression Costs Impact on Regime Choice: - Low/medium inequality & specificity: ▪ Higher repression costs: Peaceful transition to democracy more likely ▪ Lower repression costs: May facilitate authoritarian coups - High inequality & specificity: ▪ Increased mobilization of the poor: Increased likelihood of clashes and revolutions ▪ Wealthy's response: Repression remains favored, but may lead to instability and potential regime change - Historical Examples: - Western Europe: Labor mobilization + declining inequality/increased capital mobility → Peaceful democratic transitions → Britain: The rise of trade unions and the Labour Party increased the political power of the working class. Combined with declining inequality and the growth of mobile industrial capital, this led to the expansion of suffrage and the consolidation of democracy. - Southern/Eastern Europe: Labor mobilization + high inequality/immobile assets → Authoritarianism or conflict → Italy and Spain: The rise of labor movements and left-wing parties in these countries, coupled with high inequality and the dominance of landed elites, led to political polarization and conflict (fascism in Italy, Franco's dictatorship in Spain) 6. MAIN FINDINGS Key Factors Influencing Political Regimes Economic Inequality and Asset Mobility: o Stable democracies flourish when economic inequality is low, or when wealth is mobile and challenging to tax. o High levels of inequality, particularly when combined with immobile assets (like land), incentivize the wealthy to resist democracy to safeguard their wealth from potential redistribution. Economic Development and Democracy: The process of economic development often involves a shift from immobile assets (like land) to more mobile forms of capital. This transition tends to favor the establishment of democracies, as the increased mobility of capital reduces the wealthy's incentive to resist democratic reform 2.2. PAPER: ANSELL AND SAMUELS (2010) – CONTRACTARIAN APPROACH 2.2 PAPER: ANSELL AND SAMUELS (2010) – INEQUALITY AND DEMOCRATIZATION: A CONTRACTARIAN APPROACH 1. INTRODUCTION core idea: Economic development generates pressure for political liberalization in nondemocratic regimes 1. Classist perspective of Redistributivist theories 1. Based on the Median Voter Model 2. Regime change is driven by the elites' fear of redistribution under democracy 3. Inequality's Role: o High inequality: Elites fear higher taxation and redistribution under democracy because the median voter is poor o Low inequality: The median voter’s demands for redistribution are less threatening Institutions role: Institutions determine who has the power to set tax rates, shaping redistribution outcomes o Rich in control: no redistribution → everybody keeps their market income o People in control: tax rate > 0 → redistribution 2. Redistributivist Theories of Democratization: Carles Boix (2003): positive relationship between equality and democratization → democratization is more likely when income equality is high because the wealthy face lower redistributive risks o Elites’ Trade-offs between the costs of repression and the potential costs of redistribution under democracy - if the poor are not so poor or if I’m hard to tax: let people choose the tax rate because it will not be so high → e.g. US today - If I am in a setting such as Guatemala and I let the poor decide: people are going to take everything → rich prefer to invest some money for repression o Geopolitical Factor: The availability of foreign support can lower the cost of repression, making autocratic persistence more viable in highly unequal societies 4. Daron Acemoglu & James Robinson (A&R, 2006): inverted U-shaped relationship between inequality and democratization → moderate levels of inequality provide fertile grounds for democratization, while very high or low inequality deters it o Commitment Problem: Elites may promise concessions to the poor (redistribution) to avert revolution but face a credibility issue: the poor won’t believe promises without the elites ceding some real political power. o Class Struggle and Balance of Power: Democratization occurs when elites face pressure to avoid revolutionary movements, incentivizing elites to yield some power to the masses. 2.2. PAPER: ANSELL AND SAMUELS (2010) – CONTRACTARIAN APPROACH → Conflict over taxation drives democratization → change in political institutions are an outcome of class struggle and balance of power between rich and poor → The distribution of wealth, rather than its absolute level, plays a critical role in shaping the political decisions of elites regarding democratization 3. Contractarian approach 5. Olsonian / Northian perspective 6. Intra-elite Conflicts: Political liberalization arises not from elites fearing redistribution by the masses but from conflicts between economic elites, such as rising bourgeoisie demanding protection from expropriation by autocratic landowners or entrenched elites Key Distinction: Redistributivist theories do not differentiate between land and income inequality o Land Inequality: Inequality in land ownership supports autocracy, while equality fosters democratization → more equal land distribution creates more freeholders who demand political representation to protect their property rights o Income Inequality: Higher income inequality can be associated with democratization → as newly wealthy economic groups (bourgeoisie) accumulate more income: - they fear expropriation by the autocratic state and push for political reforms: demand for a “third and fourth estate” alliance to fight the aristocracy that is exploiting the rest of society - they accumulate more resources to fight and increase the probability of winning Results: o Negative relationship between land inequality and democratization o Positive relationship between income inequality and democratization → Findings challenge the redistributivist model and highlight the relevance of distinguishing between different types of inequality when analyzing democratization processes 2.2. PAPER: ANSELL AND SAMUELS (2010) – CONTRACTARIAN APPROACH 2. MODEL Three Classes 1. Landed Aristocracy: - This class is initially in power under autocracy. - They derive their wealth and political influence primarily from ownership of land 2. Industrial Bourgeoisie: - This group includes industrialists and entrepreneurs who derive their wealth from industrial production. - They possess both land and income and a growing wealth from industrialization - They seek political power to secure their assets and protect themselves from expropriation by the state or the landed elite 3. Masses: workers and small landowners who have land and income, but at much lower levels compared to the other two classes. They lack political power under autocracy but become relevant in full democratization Land Total land is normalized to 1 for simplicity in the model γ : the share of land controlled by the aristocracy → measure of land inequality in a traditional agricultural economy. o High γ : aristocracy holds a disproportionate amount of land → extreme inequality in land distribution: aristocracy is wealthier and more powerful than the rest of society o The remaining land (1−γ) : divided between the bourgeoisie and the masses → no clear distinction between the bourgeoisie and the masses in terms of land ownership Industrial income Industrial income is unequally distributed between the bourgeoisie and the masses: o Bourgeoisie’s share (φ): factory owners and industrialists → measure of Industrial Inequality → high φ : the bourgeoisie is significantly wealthier than the masses o Masses’ share (1−φ): factory workers or low-skilled labor k : size of the industrial sector → measure of Intersectoral Inequality: the relative wealth of the industrial sector compared to the aristocracy’s wealth from land o larger k : the industrial sector is growing and that the bourgeoisie is becoming wealthier relative to the aristocracy → potentially driving democratization as the bourgeoisie seeks more political power to secure its economic gains 2.2. PAPER: ANSELL AND SAMUELS (2010) – CONTRACTARIAN APPROACH 3. TAXATION Taxation under different regime types: 1. autocracy: landed elite sets its tax rate → wasted on aristocracy → expropriation 2. partial democracy: bourgeois set tax rate → use all tax rate for public good → no redistribution 3. full democracy: masses set tax rate → use all tax rate for public good 1. Autocracy: the aristocracy sets the tax rate to benefit itself exclusively: 𝒕𝑨 : the tax rate is a full expropriation from the rest of society: there is no public goods provision or societal welfare → The tax revenues are entirely pocketed by the aristocracy Probability-weighted full expropriation: The aristocracy has the power to tax others arbitrarily, effectively owning everything → fear among the bourgeoisie that the aristocracy might decide to appropriate all assets 2. Partial Democracy: the bourgeoisie gains control of the state and sets the tax rate in their interest 𝒕∗𝒑 : The tax is levied on everyone (bourgeoisie and masses) → but the revenues are used fully for public goods, not for aristocratic enrichment g : value of public goods o increases as more taxes are collected o The marginal value of public goods decreases as more is produced → taxes are set at a optimal level that maximizes utility without excessive investment in public goods Utility Maximization: The bourgeoisie in partial democracy choose a tax rate that maximizes their own utility → balancing their desire to retain income with the societal benefits of public goods. o Utility function: 𝑈𝐵𝑖 (𝑡𝑝 ) = (1 − 𝑡𝑝 )𝑌𝐵𝑖 + 𝑉𝑖 (𝑡𝑝 𝑌) → net income after taxes + the value of public goods produced, which is proportional to the total income of society and the tax rate No Redistribution: the bourgeoisie excludes the masses from political power 3. Full democracy the masses control the state and set the tax rate to maximize their utility 𝒕∗𝑫 : tax rate is higher than under partial democracy because the masses are poorer and have more to gain from taxation and public goods No redistribution: The model suggests that taxes are levied to provide non-excludable public goods rather than to redistribute wealth between classes 2.2. PAPER: ANSELL AND SAMUELS (2010) – CONTRACTARIAN APPROACH Distinctions from redistributivist theories No deadweight loss: taxes in a democracy (either partial or full) are fully used for public goods valued by all classes Tax in autocracy vs. democracy: o In autocracy, it is more like expropriation for the benefit of the elites. o In democracy, taxes are used for public reflecting the preferences of bourgeoisie or masses No assumption of linear tax rate: tax rates are set based on the maximization of utility, taking into account the non-linear effects of public goods and the preferences of different social groups 4. REBELLION OR SUBMISSION A model of the political effects of land and industrial inequality Bourgeois rebellion Autocratic Control: The aristocracy controls the state and sets policies, including tax rates Rebellion or Submission: If the aristocracy does not grant political power to the bourgeoisie, the bourgeoisie can either: o Revolt at a cost 𝑐𝐵 for themselves and 𝑐𝐸 for elites o Do nothing, continuing to live under autocracy and pay taxes set by the elites Probability of Victory: The probability of a successful rebellion, 𝑝𝐵 (𝑌𝐵 , 𝑌𝐸 ), depends on the balance of economic resources → not by size of the two groups : 𝛿𝑝 o > 0 : The more resources the bourgeoisie has, the higher their probability of success. 𝛿𝑌𝐵 𝛿𝑝 o < 0 : The more resources the elites have, the lower the bourgeoisie’s chances. 𝛿𝑌𝐸 Expected Return from Rebellion: 𝑅𝑖 = 𝑝𝐵 [(𝑡𝐴 − 𝑡𝑝 )𝑌𝐵𝑖 + 𝑉𝑖 (𝑡𝑝 𝑌)] − 𝑐𝐵𝑖 → the bourgeoisie will rebel if the expected return R > 0, balancing the probability of victory with the cost of rebellion and the benefits of winning (such as setting their preferred tax rate). Value of rebellion: with respect to LAND inequality Probability effect: o When land inequality is high, the aristocracy controls significant wealth → probability of winning decreases due to the economic strength of the aristocracy o The fewer resources the bourgeoisie has, the harder it is to challenge the aristocracy, resulting in less likelihood of rebellion Taxation effect: When land inequality is high, the bourgeoisie has little to lose if they are taxed → rebellion is less appealing because the potential tax burden is not significantly different from their current situation under autocracy Military balance is crucial: the control of economic resources by the bourgeoisie translates into political and military power 2.2. PAPER: ANSELL AND SAMUELS (2010) – CONTRACTARIAN APPROACH → Without a shift in the balance of power, democratic institutions are fragile, as autocrats can easily resist reforms or launch counter-revolutions. Value of rebellion: with respect to INDUSTRIAL inequality Probability effect: as industrial inequality grows, the bourgeoisie accumulates more wealth (via their industrial ownership), increasing the likelihood of rebellion thanks to the greater resources at their disposal Taxation effect: greater incentive to fight because more of their assets are at risk of expropriation by the aristocracy Value of rebellion: with respect to INTERSECTORAL inequality Probability effect: As the industrial economy expands and the size of industrial wealth (k) increases relative to land wealth, the bourgeoisie becomes militarily stronger and more likely to defeat the aristocracy → The probability of victory increases Taxation Effect: The richer the bourgeoisie becomes, the more they stand to lose under autocratic taxation → fight to avoid having their wealth expropriated by the aristocracy. Public Goods Effect: As industrial development grows, the potential for producing public goods also increases → If the bourgeoisie wins, they can direct resources to create public goods, which benefit both themselves and the masses. Joint rebellion The bourgeoisie and the masses both value public goods, such as security, infrastructure, and education. The aristocracy is primarily interested in maintaining their wealth and political power. → This shared interest in public goods fosters an alliance between the bourgeoisie and the masses → The appetite for public goods becomes a crucial distinguishing factor between the bourgeoisie and the aristocracy in the struggle for political power. 2.2. PAPER: ANSELL AND SAMUELS (2010) – CONTRACTARIAN APPROACH Joint Rebellion: The bourgeoisie and masses are more likely to succeed when joining forces: o Probability Effect: The chances of victory increase when their combined resources outweigh those of the aristocracy o Cost Reduction: Fighting together lowers the costs of rebellion for both groups Masses Tax More: In a full democracy, the masses set higher taxes than the bourgeoisie would prefer but expropriation by elites is worse than taxation by the masses in a democracy → rebellion more attractive to the bourgeoisie. Land inequality: Low land inequality incentivizes joint rebellion because both the bourgeoisie and masses have more resources and a higher chance of victory. Industrial inequality: does not directly affect the probability of victory (since the size of resources matters more than their origin) → trade-off for the bourgeoisie between elite expropriation and high taxation by the masses Intersectoral Inequality: A larger industrial economy increases incentives for joint rebellion: o Probability Effect: Higher probability of victory due to more combined resources between the masses and bourgeoisie o Taxation: As the masses become relatively richer, they prefer lower taxes, reducing the burden on the bourgeoisie → After winning, the bourgeoisie must accept democracy, but if the masses are too poor, they will impose high taxes. 5. CONCLUSIONS Key Argument: Democratization is driven by rising economic groups (bourgeoisie) seeking protection from state expropriation → not redistribution to the masses, as traditional redistributivist theories suggest Land vs. Income Inequality: o Land Inequality: Supports autocracy → Higher land inequality makes rebellion less likely as the aristocracy holds greater wealth and power o Income Inequality: Promotes democratization → As income inequality grows (due to industrialization), the bourgeoisie accumulate wealth and push for political reforms to protect their assets. Role of the Bourgeoisie vs Masses: o The bourgeoisie is crucial in democratization as they possess the resources to challenge the aristocracy and demand political change o The masses are incentivized to ally with the bourgeoisie because both the bourgeoisie and masses value public goods, which differentiates them from the aristocracy o The probability of rebellion success is linked to their economic strength relative to the elites. Main Drivers of Democratization: o Economic inequality: Particularly income inequality, fuels demands for democratization o Fear of expropriation: Central to motivating rebellion and political change. 2.2. PAPER: ANSELL AND SAMUELS (2010) – CONTRACTARIAN APPROACH 6. BOIX VS ANSELLE AND SAMULES Reconciling Boix and Ansell-Samuels: A Comparative Analysis Partial Democracy (Ansell-Samuels) ≈ Dictatorship of the Rich (Boix) o In Boix’s model, there is no public good provision, only redistribution o Ansell-Samuels considers public goods important in partial democracy. Both models reflect the elites’ fear of losing too much power to groups “different” from them (e.g., the poor), pushing for a regime that maintains their economic interests. The choice between partial democracy and full democracy in Ansell-Samuels is similar to the decision between dictatorship of the rich or full democracy in Boix’s model, as elites try to avoid drastic redistribution Ansell-Samuels suggests it is easier for the bourgeoisie to exclude the masses from power without paying for direct repression, while in Boix’s model, elites face direct costs for repressing the poor. o In Ansell-Samuels, the bourgeoisie’s costs are more indirect, such as a lower probability of success in fighting the aristocracy or higher costs of rebellion. Elite strategies: Why wouldn’t elites simply offer a tax rate that appeases the bourgeoisie to prevent rebellion’ → commitment problem: even if elites promise reforms, the masses and bourgeoisie do not trust them because the elites may not follow through. Empirical Challenges in Testing These Models Country-Year Observations: It is difficult to test the models empirically because country-year data are often non-independent: observations from one year influence the next, and variables like income and land distribution are not randomized Historical Evidence: Ansell and Samuels use longitudinal data from a historical cross-sectional time series to track patterns of democracy and inequality. They find general support for their claims, though the evidence is stronger for partial democratization than full democratization.  3. ELECTIONS IN DEMOCRACY AND NON DEMOCRACY PAPER: BESLEY (2006) – POLITICAL AGENCY AND ACCOUNTABILITY 1. PRINCIPAL AGENT MODEL: MICKEY MOOUSE VERSION Principal-agent models: Mickey Mouse version - one party (the principal) needs to get something done but cannot do it themselves - the principal requires another party (the agent) to perform a specific action on their behalf - The hired individual does not have intrinsic motivation to perform the task in alignment with my preferences → their actions are driven by the incentives I establish - Problem for the principal: identifying an individual willing to enter into this arrangement, and ensuring that they will perform the task as expected → 2 contraints: 1. Participation constraint: finding someone who perceives the task appealing enough to do it 2. Incentive alignment: The principal must establish incentives that motivate the agent to execute the task satisfactorily. Principal-agent: voters-politicians Politicians as agents of the voters: voters grant politicians the authority to make decisions on their behalf, with the understanding that they will be rewarded or punished based on their performance Accountability challenge: The expectation that politicians will fulfil their commitments is not guaranteed: Elected politicians may neglect their duties or engage in corrupt practices, exploiting power for personal gain Compliance mechanisms: o severe punitive measures may deter individuals from political careers o limited set of options: re-election and removal from office Selection vs. monitoring Monitoring: ensure that agent fulfil their duties effectively BUT in some cases it my be complex to how to observe what agent is doing: moral hazard → hidden action + uncertainty Selection: ensure that the agent selected is of good quality: adverse selection → hidden type  1. ELECTORAL CONTROL 2. BESLEY MODEL Baseline Model Time: Two periods: t ∈ {1, 2} Politician's Decision: In each period a politician makes a decision at time t : eₜ ∈ {0, 1} State of the World: sₜ ∈ {0, 1} where each state occurs with equal probability Voter Payoff: o Δ if if eₜ = sₜ → the politician has made the "correct" choice o 0 otherwise Discount Factor: Voters and politicians share a common discount factor: β < 1 → a payoff received in the next period is worth less than the same payoff received today Politician Types: o Two types: i ∈ {c (congruent), d (dissonant)} o π = probability of a randomly selected politician being congruent - higher π : higher quality political class - lower 𝜋 : few good politicians Office-Holding Payoff: All politicians receive E from holding office Congruent Politician Payoff: E + Δ because good politicians have same objectives as voters → always choose eₜ = sₜ Dissonant Politician Payoff: o private benefit (dissonance rent) of r ∈ [0, R] from picking eₜ ≠ sₜ → r as a bribe o r is drawn independently from distribution G(r) with mean μ o R > β(μ + E) : dissonant politicians have an incentive to sometimes choose policies that are not in the voters' best interest → agency problem Timing: 1. nature determines the state of the world (𝑠1 ) and the type of politician (if newly elected) : not observable to the voter 2. incumbent politician then picks his/her preferred action 𝑒1 3. voters observe their payoff before next elections 4. voters decide whether to keep incumbent or switch to randomly-selected challenger 5. Period 2 actions (𝑠2 , 𝑒2 ) and payoffs 3. EQUILIBRIUM Equilibrium Behavior: perfect Bayesian equilibrium Politicians' Optimality: In each period, both congruent and dissonant politicians make decisions that maximize their expected payoff, considering the voters' re-election rule. Voters' Bayesian Updating: Voters use Bayes' rule to update their beliefs about the politician's type (congruent or dissonant) based on the observed policy outcomes.  1. ELECTORAL CONTROL Period 2 Behavior: All politicians act in their immediate self-interest → no electoral incentives because it is the last period Congruent politicians choose (e₂(s, c) = s₂): the policy that aligns with the state of the world to maximize voter payoff and secure re-election Dissonant politicians choose (e₂(s, d) = (1 - s₂)) : the policy that goes against the state of the world to gain the dissonance rent r Period 1 Behavior Notations: o λ: The probability that a dissonant politician chooses the policy aligned with the voters' preference in Period 1 (index of political discipline). o The voters' posterior belief that the politician is congruent, given they received a positive payoff in Period 1: It's calculated using Bayes' rule and is always greater than or equal to the prior belief (π) π Π= ≥ π π + (1 − π)λ - Numerator: good type - Denominator: good type + bad type that choose right Equilibrium Strategies: o Re-election Rule: Voters re-elect the incumbent if and only if they receive a positive payoff in Period 1 - positive payoff signals a higher likelihood of the politician being congruent - if payoff is 0, politician is bad type for sure o Congruent Politician's Choice: Always chooses the congruent action, assuming re- election is guaranteed for doing so o Dissonant Politician's Choice: A dissonant politician compares - the immediate dissonance rent (r₁) → out of office - the future benefits of re-election (β(μ + E)) → forgo r₁ and stay in office → They choose the congruent action (and forgo the rent) if r₁ is less than the discounted future benefit: maybe in period 2 someone offers a larger bribe → bad politician does not steal if r₁ is small: r₁ is not large enough with probability λ = 𝐺β(μ + E) Proposition 1: Congruent politicians always set e = s Dissonant politicians choose e= (1− s) in Period 2 and will choose e = s in Period 1 with probability λ : if the immediate dissonance rent r is small enough compared to the discounted future benefits of re-election All politicians who choose e= s in Period 1 are re-elected.  1. ELECTORAL CONTROL 4. IMPLICATIONS Discipline vs. selection Elections serve two purposes: selection and discipline Selection Effect: Elections help filter out bad politicians and retain those who act in the public interest → Politicians who are elected in the second period are typically of higher quality than a random candidate, as they have survived the election process by demonstrating good behavior. Discipline Effect: The need for re-election encourages politicians to act in the public interest, even if their primary motivation is self-serving → Politicians may refrain from accepting bribes due to the higher expected value of remaining in office: use their self interest in the public interest → While, in the second period when there is no election, politicians behave according to their true nature Brazil mayors All the good types are going to be re elected in period 2 A fraction λ of the bad types gets reelected  1. ELECTORAL CONTROL The quality of government Voter payoff o Period 1 Voter Welfare: V₁(λ) = [π + (1 - π)λ] → Increases with λ : better off the more discipline from dissonant politicians (forgo bribe) o Period 2 Voter Welfare: V₂(λ) = π[1 + (1 - π)(1 - λ)] → Decreases with λ : fewer dissonant politicians are caught in Period 1 → always better if quality of politicians (π) higher → political turnover (1−π)(1−λ): higher turnover associated with lower voter satisfaction 5. POLARIZED POLITICS BEYOND BELSEY MODEL Besley model: two actions for politicians → what if politician can choose any action on continuum? → Persson/Tabellini approach (e.g., Persson Roland Tabellini 1997) assume voters observe exact extent of corruption before election result: voters cannot condition re-election on stealing 0 → impossible to not force them to steal: o if rule too strict, politician steal 100% in every period and stay out of office o tolerance of corruption can be rational: corruption as interest of the poor → optimal rule is the strictest that even a corruption-prone politician is willing to respect POLARIZED POLITICS basic model: o no ideological disagreement among voters o only vote based on performance o no parties o no uncertainty in how people vote: choose based on payoff Polarized model extends the baseline political agency model to incorporate the effects of: Randomness in voting: add noise in how voters behave → uncertainty parties: candidates have parties and voters have attachment to some party citizens have ideological leanings: polarization candidates might have advantage: one party can be more popular than another  1. ELECTORAL CONTROL MODEL Two parties: A and B, each with a fixed policy position Two types of issues: - Ideological: where voters disagree - Valence: everyone agrees → assume ideology and valence separable: even if you despise someone, in the end you prefer what’s best for your country Two types of voters: o Partisan voters (ω): - Vote based on party affiliation (ideology) - Get utility ϕ > 0 from having their preferred party in office o Non-partisan voters (1−ω): - Vote based solely on non-partisan (valence) issues - Probabilistic voting: ▪ Idiosyncratic Shock: random factor specific to each individual voter that influence its preference→ not consequential in the agreggate ▪ Aggregate Popularity Shock: collective swing in non-partisan voter sentiment e.g. scandal INCUMBENT 1 Incumbent's advantage: Partisan support: 2 + 𝜂 of partisan voters prefer party A (incumbent) Incumbent wins and beats challenger iff 𝜔𝜂 + (1 − 𝜔)(Δ(Π − π) + δ) > 0 → incumbent overall advantage (partisan + non-partisan) is positive: - 𝜂 : natural advantage due to partisan support → + - Π : posterior probability that the incumbent is congruent - Δ(Π − 𝜋) : if positive means the incumbent has a good reputation - δ : aggregate popularity shock → + Probabilty of the incumbent to win : 1 o 1 if θ + (Δ(Π − 𝜋)) > 2𝜉 1 o 0 if 𝜃 + (Δ(Π − 𝜋)) < − 2𝜉 𝟏 o + 𝝃(𝚫(𝚷 − 𝝅)) otherwise 𝟐 𝜔 - 𝜃= 𝜂 : advantage due to partisan support → If all voters are ideological → 𝜃 1−𝜔 very large and I win for sure - ξ: degree of noise in the voting process → lower ξ implies more noise - η: degree of political competition → higher η implies less competition, favoring the incumbent → Implications:  1. ELECTORAL CONTROL Polarization (higher ω) weakens accountability: Partisan voters may prioritize party affiliation over the incumbent's performance on non-partisan issues → re-elected no matter your behavior Lack of competition (high η) reduces accountability: When the incumbent has a significant advantage and voters are polarized, there's less incentive for the incumbent to be responsive to non-partisan concerns Incumbent will choose the congruent action if 𝑟1 ≤ [𝜎(𝜃 + (Δ(Π − 𝜋)) − 𝜎(𝜃)] 𝛽 (𝜇 + 𝐸) = 𝜉 (Δ(Π − 𝜋)) 𝛽 (𝜇 + 𝐸) o [𝜎(𝜃 + (Δ(Π − 𝜋)) − 𝜎(𝜃)] : gain from behaving well (choosing congruent action not partisan) o The incumbent weighs the immediate gain from acting against the voters' interests against the potential future benefits of re-election that they'd get by acting in the voters' interest Probability of congruent action from dissonant politician: (𝟏 − 𝛑)(𝟏 − 𝛌) 𝛌 = 𝑮 (𝝃 (𝚫𝛑 ( )) 𝛽(𝜇 + 𝐸)) 𝛑 + (𝟏 − 𝛑)𝛌 → probability that the rent from dissonance is less than or equal to the expected future benefits of acting congruently → Implication: Higher electoral uncertainty (lower ξ) reduces discipline (𝝀): If the election outcome is more uncertain (more noise), the potential gain in winning probability from acting congruently is smaller → This makes dissonant politicians less likely to choose the congruent action SUM UP - with only valence issue (no partisanship or ideology) trade-off between discipline and selection - with ideology, electoral accountability more effective when 1. there is less “noise voting” 2. there is less polarization 3. political competition evenly balanced - general message: many goals (selection, discipline, ideological choice) but only one blunt (binary) instrument: the vote  2. SPATIAL MODEL OF POLITICS 2. SPATIAL MODEL OF POLITICS EUCLEDIAN UTILITIES In real world, parties decide who to appeal to and how much to appeal Policies are points in space 𝑆 ⊂ ℝ𝑘 Voters have ideal points i 𝑥𝑖 ⊂ ℝ𝑘 The utility that voter i gets from policy x depends on the negative distance between the ideal point of the voter and the policy: 𝑈𝑖 (𝑥) = −𝐷(𝑥, 𝑥𝑖 ) → dislike equally what is too extreme on one side and too extreme on the other side → utility maximized when policy coincides with ideal point PAPER: GEHLBACH (2013): ELECTION COMPETITION UNDER UNCERTAINTY 1. OFFICE SEEKING PARTIES MODEL Two parties (A and B) compete in a one-dimensional policy space Each party's strategy is to choose a policy position (𝑥𝐴 and 𝑥𝐵 ). Parties' goal is to maximize their probability of winning the election: A maximizes π(𝑥𝐴 , 𝑥𝐵 ) → only care about winning office not the policy Voters o A continuum of voters, each with a unique ideal point 𝑥𝑖 o The distribution of ideal points has a unique median, 𝑥𝑚 o Voters have Euclidean preferences: they prefer policies closer to their ideal point ▪ Utility function: 𝑈𝑖 (𝑥) = −|𝑥– 𝑥𝑖 | o Voters vote sincerely for the party whose policy they prefer Electoral rule: Plurality rule (most votes wins, tie broken by a fair lottery (coin)) Probability of winning for A o 1 if more votes than B o 0 if fewer votes than B o 1/2 if exactly same votes EQUILIBRIUM Unique Nash Equilibrium: 𝑥𝐴 = 𝑥𝐵 = 𝑥𝑚 → Both parties converge to the median voter's ideal point Party B's best response o If 𝑥𝐴 < 𝑥𝑚 , any position closer to 𝑥𝑚 than 𝑥𝐴 guarantees a win for B o If 𝑥𝐴 > 𝑥𝑚 , any position closer to 𝑥𝑚 than 𝑥𝐴 guarantees a win for B o If 𝑥𝐴 = 𝑥𝑚 , the only best response for B is also 𝑥𝑚 Party A's best response is analogous → The logic of political competition drives both parties to adopt the median voter's position: This is the only point where neither party can improve its chances of winning by changing its position  2. SPATIAL MODEL OF POLITICS 2. POLICY SEEKING PARTIES MODEL Two parties (L and R) compete in a one-dimensional policy space Each party's strategy is to choose a policy position (𝑥𝐿 and 𝑥𝑅 ) Parties' goals: Policy-seeking: Parties want to implement a policy as close as possible to their ideal points o L's ideal point is 0 o R's ideal point is 1 → parties are located on the extremes Voters: o A continuum of voters, each with a unique ideal point 𝑥𝑖 o The distribution of ideal points has a unique median, 𝑥𝑚 o Voters have Euclidean preferences o Voters vote sincerely for the party whose policy they prefer Electoral rule: Plurality rule Parties' payoffs: o L's payoff: −|𝑥| (where x is the implemented policy) o R's payoff: −|𝑥 − 1| with 0 < 𝑥𝑚 < 1 (parties are polarized) EQUILIBRIUM Probability of winning of L: 𝜋(𝑥𝐿 , 𝑥𝑅 ) → L maximizes: max 𝜋(𝑥𝐿 , 𝑥𝑅 )(−|𝑥𝐿 |) + [1 − 𝜋(𝑥𝐿 , 𝑥𝑅 )](−|𝑥𝑅 |) 𝑥𝐿 → trade off between: - Compromising and increase chance to implement my favourite policy: propose policy that wins votes - Being ideologically pure and losing: propose policy party finds ideologically appealing Nash Equilibrium: (𝑥𝐿 , 𝑥𝑅 ) = (𝑥𝑚 , 𝑥𝑚 ) o Both parties converge to the median voter's ideal point o Any deviation leads to a certain loss, which is worse than the expected utility of tying at the median → Even though parties are policy-seeking, the need to win elections to implement their preferred policies drives them to converge to the median voter's position UNCERTAINTY ON MEDIAN VOTER LOCATION location of median uncertain: you are not sure to win even by proposing 𝑥𝑚 L maximizes: max 𝜋(𝑥𝐿 , 𝑥𝑅 )(−|𝑥𝐿 |) + [1 − 𝜋(𝑥𝐿 , 𝑥𝑅 )](−|𝑥𝑅 |) 𝑥𝐿 → as Party L (and similarly Party R) moves its policy closer to the median voter’s position, the probability of winning increases gradually → the parties will locate at equal distance from the center: Both parties likely end up moderating their positions compared to their ideal points, but they don’t converge perfectly at the centre  2. SPATIAL MODEL OF POLITICS 3. MULTIPARTY COMPETITION Model Three or more parties compete. Voters vote sincerely, but ties are broken with an equal-probability rule → Convergence to the median is NOT an equilibrium → Equilibrium existence is not guaranteed and depends on specific model assumptions The distribution of voter preferences significantly impacts the possibility of equilibrium. NO uncertainity: multi-party competition tends to lead to unstable and strange outcomes, such as the lack of equilibria for three parties or parties that are doomed to lose WITH uncertainty: more realistic and stable equilibria are possible, especially when factors like random voter preferences or party identification are introduced → solutions can be found if specify better institutional framework → INSTITUTIONS MATTER LACK OF CONDORCET WINNER You have 3 groups in society: o 1 prefer to remain o 1 prefer to leave with a deal o 1 prefer to leave with no deal No group has a absolute majority: o DEAL VS NO DEAL - Remoaners vote Deal (30) - Brexiteers vote Deal (25) - No Dealers vote No Deal (24) → Deal wins with 55 vs 24 o DEAL VS REMAIN - Remoaners vote Remain (30) - Brexiteers vote Deal (25) - No Dealers vote Remain (24) - Remain wins with 54 vs 25 o REMAIN VS NO DEAL - Remoaners vote Remain (30) - Brexiteers vote No Deal (25) - No Dealers vote No Deal (24) - No Deal wins with 54 vs 25  2. SPATIAL MODEL OF POLITICS → CYCLE: 1. pit two alternatives against each other 2. pit winner against third 3. pit winner at step 2 against third option 4.... → either outcome depends on alternatives voted on at step 1... → or can go on forever.  3. ELECTIONS IN DEMOCRACIES AND NON DEMOCRACIES 1. PR VS MAJORITARIAN – LOGIC 1. ELECTORAL SYSTEMS – BASICS ELECTORAL SYSTEMS 1. PR SYSTEMS: - voters choose a party NOT a person - every district sends to legislature some number M of representatives: you are voting a group of candidates 2. MAJORITARIAN SYSTEMS: - voters choose a candidate NOT other team members - every district sends one representative → as district magnitude → 1, PR approaches majoritarian: as you reduce M, proportionality decreases - Spain: very few people are elected in districts - Chile: weird two-member-district 1. MAJORITARIAN SYSTEMS candidate with the most votes is elected “most votes" might mean different things depending on the variant of majoritarian system in adoption o plurality: candidate who has more votes than any other e.g. you can be the winner even if you have 25% of votes but all the others have 20% o double-round majoritarian: elected only if you have an actual majority - double round of voting: in second round, only top two of first round compete - small parties can run first round, then endorse candidates in second round strong incentive to “vote strategically”: do not always vote for the most favourite candidate Problem: Often significant mismatch between the percentage of votes a party receives and the number of seats they win in the legislature o the candidate with the most votes in a district wins the seat, regardless of how much more or less they received compared to others o If a party’s support is evenly spread across many districts, it can win just over half of the votes in each district and take 100% of the seats in those districts o This can lead to situations where a party that does not enjoy majority support in the country as a whole can still have total control of the legislature Drawing districts: how districts are drawn determines how votes are distributed and how many seats each party wins in the legislature o geographical heterogeneity can help you maintain balanced electoral results o political parties have a strong incentive to influence or manipulate this process in their favor o if the process becomes highly politicized it can cause the problem of gerrymandering 1. PR VS MAJORITARIAN – LOGIC Constraints on how to draw districts: o The districts have to be compact: they cannot have island in the middle o The districts should have approximately the same population o There should be similar ethnical composition → massive problem in majoritan systems functioning : you can start with the same distribution of voters and end up with very different election outcomes Malicious gerrymandering 1. PR VS MAJORITARIAN – LOGIC Seats – vote function: What voters do turns into allocation of seats The amount of power you get is proportional to the votes parity line diagonally cuts across the chart: represents the point where the percentage of seats won is equal to the percentage of votes received regression line: depict the general relationship between vote shares and seat shares over time → steeper than identity line: it indicates that for every percentage point increase in vote share, the Democrats tended to gain a disproportionately higher number of seats → the regression line does not pass through (50, 50) represent a situation where the Democratic Party wins 50% of the seats with 50% of the vote: structural distortion 2. PR SYSTEMS there is a list of candidates competing: each party presents a list voters do not vote for a candidate but for a list M seats are allocated, according to vote shares 𝛼𝑖 each party i gets (approximately) 𝛼𝑖 M seat o e.g., party A gets 1/2 of vote, M= 6: get 1/2 ∗6= 3 seats o e.g., party B gets 1/3 of vote, M= 6: get 1/3 ∗6= 2 seats o e.g., party C gets 1/6 of vote, M= 6: get 1/6 ∗6= 1 seat 2 varieties of PR systems: o closed list: parties get to choose the order of who is going to occupy the seats and communicates it to the voters o open list: voters decide the order by expressing preference within party candidates (kind of an “instant primary”) → in party competition thresholds: o explicit thresholds: decided by States in advanced o implicit thresholds: smallest share of votes to be elected → in general, more parties represented with PR PAPER: HUBER AND POWELL (1994) – CONGRUENCE PAPER: HUBER AND POWELL (1994) - “CONGRUENCE BETWEEN CITIZENS AND POLICYMAKERS IN TWO VISIONS OF LIBERAL DEMOCRACY 1. DEFINE DEMOCRACY DAHLIAN VIEW Dahl 1989: “a democratic government provides an orderly and peaceful process by means of which a majority of citizens can induce the government to do what they most want it to do and to avoid doing what they most want it not to do” Democracy is justified by its ability to create congruence between citizen preferences and government policies Dahl posits that democracy helps citizens achieve what they “most want the government to do” and avoid policies they oppose SCHUMPETERIAN VIEW: In contrast to the Dahlian view: democracy as an elite-driven process Competition among elites (politicians or parties) ensures representation: elites compete for votes, and through this competitive process, they remain responsive to citizens, though not necessarily congruent with their preferences OPERATIONALIZING CONGRUENCE Congruence: the alignment of government policies with the preferences of citizens measured along the left-right ideological dimension Measure congruence: Evaluate how far the policy output is from the median voter (MV) In coalition governments, policy could be: o The mean of party median: average of the median positions of each party in the coalition → reflects the central tendency of all coalition partners o The median of party medians: choose the position of the party that is ideologically closest to the center of the coalition o A more complex function of all coalition partners’ positions (since preferences in coalitions are inherently multidimensional): weighted function Political scientists lack a clear, predictive model of how legislative and executive bargaining processes determine the final policy outcome in coalition settings MEDIAN VOTER