Chapter Four The Development of Democratic Institutions and Their Impact relationship between democracy, social policy, and inclusive economic growth institutions) are important in explaining the relationship between democracy. relationship between human rights, democracy and community development? Can the three What are the major problems besetting effective realization of. Figure 1 plots the correlation between a commonly used index of democ- tutions as a fundamental factor in explaining cross-economy differences in income . democracy and social capital, the literature in economics has traditionally.
Another factor would be the education of the labor force. Specifically the years of schooling of an average citizen. This greatly elevates the probability that a democracy will survive.
However, even though income and education are highly correlated, their impact seems to be to some extent independent, with the impact of per capita income being much stronger.
Empirical patterns show that a democracy is more fragile in countries where per capita income stagnates or declines, but the causality is not clear. The fact that economic growth is tightly connected to democracies does not come as a surprise, since democracies are more frequent among the economically developed countries, and are rarer among poor ones. Effects of economic development on democracy[ edit ] The notion of economic growth having a greater influence on democracy was a very popular opinion in the s.
The most important work on the subject has been done by Lipset  where he states that economic development is one of the prerequisites for democracy. However, this is not true. Both concepts are of equal importance and there are many cases where one acts as a prerequisite for the other, i. Economic development may influence democracy in many ways. By tightening the revolution constraint, creating rising inequality or simply increasing the level of income in the society.
This means that as an economic structure transforms, and since it is related to capital intensity, capital itself becomes more important than land, which is one of the reasons that states with a higher income per capita would generally perform better.
Democracy and economic growth
As mentioned, the causality of economic development and democracy is inconclusive. However, if we consider that democracy should be supported by some preconditions, it is economic growth that creates these conditions for democracy: Work done by Lipset is best well-known on this topic. By his comparative studies Lipset shows a strjong statistical association between GNP per capita and the level of democracy, to finally conclude that "the more well-to-do a nation, the greater the chance that it will sustain democracy".
It is especially relevant in just shaping democracies, even though they may survive in poorer conditions. As democracies require certain political institutions, it is quite interesting that they do not have a high impact on economic growth. What matters for economic development is, in fact political stability, rather than a particular political institution. As it is safe to assume that any political institution will promote development as long as it is stable, which means that the danger lies in political instability.
Yet, political instability does not affect economic growth in democracies, only in dictatorships. The reasons for this are not entirely clear, whether it may be due to institutional constraints or of motivations of those who govern democracies.
Under dictatorships, it slows down significantly when the tenure of rulers is threatened. Similar outcomes emerge under various forms of "socio-political unrest" such as strikesanti-government demonstrations and riots.
Under different regimes, political phenomena have a different meaning, and as such, it is not surprising that economic actors react differently. It just means there are things yet to be explained in the world.
The Theory Basically, the theory is just that as an economy develops it also tends to become more democratic. He uses some indicators of economic development and shows that the countries with high levels of economic development are also the ones that are democracies.
Cutright goes a lot further as did a lot of other modernization theorists: Similarly, if a democratic country's economy slipped it would eventually become less democratic. What does a developed economy look like? Of course, this research will very highly depend on how you measure the state of an economy.Once upon a time, local democracy
A developed economy should be higher in urbanization. This does tend to happen as an economy develops agricultural workers move to urban areas to take jobs in manufacturing, and eventually the manufacturing jobs are lost to service jobs.
Democracy and economic growth - Wikipedia
Back in the hey-day of modernization theory, this was measured as the number of telephones per 1, people. Not only can a developed nation afford telephones, communication lines are valuable for economic growth. A developed nation has a well-educated work force. The reasoning is again two-fold: More income per person should generally indicate a more developed economy.
The modernization "story" The common story of modernization theory begins with an undeveloped, authoritarian government. With time the economy grows, resulting in higher wages and standards of living.
A number of political scientists participating in the Namibia workshop found it necessary to point out that the concepts of democracy and governance were interrelated, but were not the same. They indicated that "good governance entails the efficient and effective reciprocity between rulers and the ruled, with it incumbent upon government to be responsive.
Majoritarian democracy, on the other hand, entailed a broad consensus on values and procedures, the participation in the selection of ruling elites, and the accountability of leadership to the electorate.
Both concepts were related to processes in society within the context of reciprocity. Still, there was agreement in the meetings that African governments are deeply in need of governance reforms. In the Namibia meeting, one participant was of the opinion that the argument that all of Africa has practiced bad governance "is not an accurate statement.
In reality, there are few Mobutu Sese Sekos. Most African governments have been in difficult situations and they have opted for the easy way out. Foreign governments did not insist on good governance, either.
Even when policies failed, assistance kept coming. Only recently have donors been raising the governance issue, linking it to assistance in order to ensure that the economy and politics be liberalized.
Increasingly, Africans are saying that such conditions should be tied to policy performance, but not to a particular blueprint for democracy. Africans should design their own approach to democracy, make a good-faith effort to govern well and to have programs work in an efficient manner, and strive for the development of a culture of democracy between the rulers and the ruled. Perhaps improved governance will take hold before democracy.
Africa is liberalizing, but it will take time, and one must be prepared to persevere for a long haul. It was pointed out also that democracy in Africa has been badly hindered by the state's control of the economy; this has meant that the only way to get rich has been through political office, intensifying the problem of corruption, and inducing leaders to cling to political power. This has been disastrous for the economies in African countries.
Thus, economic liberalization, empowering ordinary producers, may well be an aid to political democracy. Furthermore, in most African countries, the small number of individuals with power have managed to erode any semblance of accountability, legitimacy, democracy, and justice, which has been a basis of considerable disappointment to the planners, economists and policy makers who want African governments to introduce a reasonable and collective attack on poverty, disease, illiteracy, and other challenges to development.
In the deliberations, certain desperately needed elements of good governance were identified, including popular participation in governance, accountability and transparency, the elimination of corruption, the protection of freedom of information and human rights, and the decentralization and devolution of power.
Page 34 Share Cite Suggested Citation: This recognition emerged from the Arusha Conference "Putting the People First" of Februaryconvened under the auspices of the United Nations Economic Commission for Africa and attended by over delegations representing grass roots organizations, nongovernmental organizations, United Nations agencies, and governments.
The African Charter for Popular Participation in Development and Transformation, which was adopted by the plenary, holds that the absence of democracy is a principal reason for the persistent development challenges facing Africa: After all, it is to the people that the very benefits of development should and must accrue.
We are convinced that neither can Africa's perpetual economic crisis be overcome, nor can a bright future for Africa and its people see the light of day unless the structures, pattern, and political context of the process of socioeconomic development are appropriately altered. In the three workshops, the importance of popular participation in building democratic society likewise was underscored: When one examines existing democratic societies, one realizes they have succeeded primarily because they have involved people to help make it work.
Also, they have empowered those engaged in democratic projects. In short, they have succeeded by giving voice to those who have been voiceless. As such, critics of the government either are intimidated or absorbed. Page 35 Share Cite Suggested Citation: Foreign nongovernmental organizations also tend to work with governments and may be used by them in order to promote government patronage.
For example, it was noted that "measures that require the registration of civic associations, such as trade unions or student movements, have been used by governments to dissolve associations on petty pretexts. It also was suggested that civic associations become institutionalized and begin to support one another. Explicit measures to this end have been taken in Zambia since the recent presidential elections.
One participant also pointed out that nongovernmental organizations in Namibia were inculcating a sense of participatory democracy in their projects, including in the schools.
In discussing the relationship between participation and efficiency, the question of what is meant by efficiency was raised. Participants suggested that "a technocratic approach to efficiency takes political issues out of the hands of the people and stifles participation. One classic example of this approach has been the imposition of structural adjustment programs, under which the entire management of the economy is removed from the realm of participatory politics.
If, on the other hand, the efficiency of the government is to be measured by its ability to meet the needs of its people, then a high level of participation can only promote this end. Discussions could have helped people to be prepared for the impact of reforms. In this manner, perhaps the reforms even could have been softened.
Democracy and Development: Thinking Forward
If efficiency is measured by the government's ability to meet the needs of its people, they suggest, then "the first task of government is to make sure citizens' lives improve on a daily basis, because if citizens do not see improvement, their enthusiasm for supporting government policies wanes. The misuse or diversion of assistance and domestic funds by corrupt officials, which was tolerated during the cold war to receive support in the international system, is being replaced by a new emphasis on good governance.
In the past, said a number of participants, "aid appeared to be driven by certain political factors without a congruence of interests between givers and receivers. Among some participants, the assumption is that such groups can act as watchdogs, serving as the best deliverers of assistance; a number of participants did not agree, arguing that newly democratic governments should receive and channel such aid.
With regard to public officials, participants pointed out that mechanisms must be devised to hold leaders responsible when they use public resources in ways that society considers unacceptable.
To that end, they noted that any public accountability system should include periodic competition and a clear set of rules and expectations. Participants emphasized the notion that the principle of accountability, essential to democracy, requires exposing the truth, with stated and enforced consequences for violating the rules, without exception, even for those in power. The lack of accountability in Africa has led to the gross misuse of public resources. For example, single-party systems in Africa do not allow for much in the way of accountability.
The effect has been rampant corruption and the deterioration of socioeconomic conditions—an indication that people in Africa were governed without being able to control their governors.
The causal relationship between economic development and democracy - Politics Stack Exchange
This not only requires systems of financial accountability, but also the capacity and willingness to monitor the overall economic performance of the government. Another challenge discussed under the rubric of good governance was to achieve transparency in government transactions. In most African countries, participants noted that it is difficult to find functioning establishments in which government accounts, external procurement procedures, and central bank operations are discussed objectively: The state must be deprivatized [from domination by the few] and a public arena must be created where there would be room for argument and discussions based on what is good for the entire society.
Things should be argued in public terms so that everyone can participate on an equal basis. Several participants pointed out that government should not conceal information from its citizens. A number of suggestions were put forward by participants regarding the ways in which transparency might be achieved in Africa.
These included freedom of the press, donors' insistence that governments make their ledgers and gazettes public knowledge, requiring declarations of assets from public officials, exposing and confronting corruption, and accountability from below. Some participants also raised the question of whether donors genuinely verify democratic conditions in recipient countries, such as Liberia and Kenya.
In the case of Liberia, participants suggested U. With regard to Kenya, participants pointed out the inconsistency in application of the good government policy advocated by the British, compared with other bilateral donors. Despite Daniel arap Moi's initial reluctance to yield to the demands for multiparty politics, Kenya received substantial British investment and was defended by both Foreign Minister Douglas Hurd and Aid Minister Lynda Chalker as having a good human rights record.