The readings we have for this week attempt to explore how different democracies function and what political and economic implications they entail. Some researchers chose to look at a particular set of countries (i.e. Denisova et al. and McGillivray), while others took a more ambitious step to conduct (large-N) cross-national comparison. As I will argue later, in my opinion small-N comparison seems to produce more leverage since the results we have based on cross-national comparison mostly turns out to be either incomplete or confusing.
To begin with, for Blaydes et al., although they argue average daily calorie consumption will be a better alternative to measure inequality and observe how economic growth will benefit the least well-off in a society, I am not convinced that why and how it can be a good alternative proxy to measure inequality if they had to go through such complex procedures to assure the robustness of their analysis. Researchers who use GDP per capita may have relied on similar statistic tools to assure the robustness of their findings. Also, I do not see very clearly how this article explains the conflicting results of previous empirical studies between democracy and inequality. Treating hybrid regimes as a single category is also misleading as elections in this category may not always be so competitive that dictators need to purchase the support of the least well-off.
Similarly, for Rodrik, in the first part of his article he presents a quite compelling hypothesis to explain what institutions are best suited for economic transition and development, but his proxy variables do not really approximate the conflict management function of democratic institutions. Besides, he uses South Korea and Thailand to illustrate that participatory democracies tend to better deal with financial crises, but do both of these countries really rely on their participatory political institutions to resolve economic depression? If yes, how did they do it? Rodrik only explained the connection between participatory institutions and economic transition from the results without specifying the causal mechanism. Last but not least, the intermediate level of democracy creates huge and noticeable variation in economic performance. Why?
As the cross-national comparison tends to create more confusion that demands further clarification, I hence believe that starting with small number of similar cases maybe a better approach. For example, McGillivray thoroughly tackled three different cases for each category she specified (though Brazil did not receive equal amount of attention) and did a nice job in explaining how electoral rules and party strength, when interacting with an industry's geographic characteristics, will shape politicians' incentive to protect a particular industry. I think it is a very good book especially because she is highly aware of the weakness of her analysis and tried hard not to overclaim her results.
In a similar vein, Denisova et al. focused on post-Soviet countries to explore how institutional settings will affect the difference between the support from the low-skilled and the high-skilled for revising privatization. While I think their explanations are very clear and well-written, one possible problem in their analysis is that they did not explain why substitutablility view is rejected within the special contexts of post-Soviet countries. Complementarity view may win in their work perhaps because democratization in Russia and other post-Soviet countries does not facilitate redistribution due to relatively low degree of inequality at the beginning of transition, and not all countries in other regions start economic transition with this situation. They may also need to explain why the entrepreneurs and managers only occupy a small proportion of the total respondents, and how they may affect their results. The last but certainly not least problem is: why is it legitimate to assume democracy and good governance go along together?
Following my last comment, two things are brought out that I think worthwhile for further discussion: First of all, many scholars differentiate political regimes along two dimensions (e.g. forms of government and quality of governance; electoral rules and forms of government; electoral rules and party strength, etc.). While we may follow these dimensions to explore how they affect politicians' behaviors and government decision-making, like Boix did in Democracy and Redistribution, I found it surprising that few have carefully tackle the interaction of the two dimensions they propose (Joan made a similar point last week). Especially for Persson and Tabellini's piece, they constantly draw both dimensions together in their analysis but separate them in different sections, causing much confusion and unsatisfying results. Second, does the dichotomous typology widely employed by political scientists, especially those conducting quantitative analysis, really capture the variation across different political regimes? More specifically, is it really fruitful to separate regimes into democracy vs. autocracy or presidentialism vs. parliamentarism?
@Chao-yo: It is true that thus far, few scholars have investigated the interaction effects between different independent variables, and in turn, how these effects could influence policy outcomes such as politicians' behaviour and government decision-making. However, I did not find it that surprising because I thought it would be natural for scholars to first focus on the individual independent variables before they conduct further research on the interaction effects between these variables. That said, some scholars have picked up on this shortcoming and studied the interaction effects between variables. An example would be Joachim Wehner's study of the interaction effects between size fragmentation (number of decision makers) and procedural fragmentation (the structure of the process in which actors interact) within the legislature and how this influences fiscal policymaking and thus budget deficits. I think it would be an interesting article to read, especially since we are focussing on how institutions can affect economic policy outcomes in this lesson. The full text pdf is on this website: http://cps.sagepub.com/content/early/2009/11/25/0010414009347828.short
Regarding Chao-yo's second question on the usefulness of a dichotomous typology in studying political regimes, my view is that the usefulness of this approach depends very much on the specific objective of the paper and the context in which it was written. The advantage of using a dichotomous measure is that it allows scholars to directly compare two extreme scenarios and this contrast could make it easier to discern differences in the variables' impact on policy outcomes, which is probably very useful for preliminary research and for providing a basis which further research could then build upon. An analogy would be how economists have built many models and theories based on perfect competition as an industry structure; clearly there are few industries in the world where perfect competition holds completely true, but it is nevertheless a useful theoretical concept and a benchmark against which we could compare reality, precisely because of its extreme qualities. The same applies to autocracies and democracies--we could always employ a dichotomous typology as a "first cut" and build upon the findings subsequently.
Moving on to my comments and questions about this week's readings, I find the notion of institutional convergence mentioned briefly in Rodrik's conclusion to be very interesting. Most papers have focussed on how different institutional setups, e.g. different regime types, different electoral rules and types of government (Persson & Tabellini), could have different effects on policy outcomes, but few have explicitly discussed the extent and desirability of institutional convergence between developing and developed economies and amongst developed economies themselves.
A salient example would be European integration, which demands a high degree of institutional convergence and the pursuit of similar policies spelt out for instance in the Stability and Growth Pact. However, each country has different structural attributes e.g. different labor market dynamics, and differences amongst members are frequently observed, perhaps more noticeably between the "core" and "peripheral" members. Indeed, cases such as Greece illustrate the importance of ensuring the compatibility of institutional convergence with local conditions and needs--a point highlighted by Rodrik.
Hence another important question for Comparative Politics would be: how desirable is institutional convergence? Although many studies have demonstrated the benefits of pursuing democratic ideals and institutions, and market liberalization, to what extent is this desirable for non-Western countries? Even within developed economies, to what extent would it be beneficial for countries to pursue similar institutions, ie what are the gains (compared to the costs) of institutional convergence, particularly in light of the rapid financial and economic globalisation that we have witnessed within the past decade?
Mancur Olson’s rational choice conception of leader’s incentives and taxation maximization lead him to argue that autocracies will rarely have good growth rates for more than a generation. In contrast, the conditions necessary for a stable democracy are also conducive to good economic growth rates. Olson’s argument regarding the growth under benevolent dictators is convincing, but also empirically flawed. First, Olson models exploitation by the autocrat exclusively from the point of taxation and disregards any other incentives the autocrat might have. If we take into account other possible incentives of autocrats (ideology, prestige, international pressure), it is clear that decisions are not made with the exclusive idea of maximizing taxation revenue. Further, Olson’s conception of the benevolent autocrat excludes extractive regimes where instead of relying on taxation for rents, the regime is able to benefit directly from the resource itself, alienating the population from governance, creating a huge services gap and driving down incentives to develop other sectors of the economy. In the case of kleptocratic autocratic regimes the population does not desire “long live the king” because the autocrat’s only desire is to steal as much as possible while he is in power and has no incentive to increase taxable income. Also problematic is Olson’s conception about how democratic regimes emerge. He claims that a balance of power or a stalemate among competing small-scale autocrat will result in a situation when the only solution is to “engage in fruitless fighting or to work out a truce with mutual toleration” (573). Ironically, Olson seems to neglect the collective action problem and does not provide an adequate explanation for why these leaders would have a common interest in establishing an independent judiciary and elections. In fact, it seems counterintuitive that the autocrats of small regions would be willing to cede power with no guarantee of certain power sharing (though this may explain why PR would be more likely than majoritarian government). Olson’s story doesn’t make sense in a purely rational choice conception. This piece, along with the others we read for today’s class treat democracy as a fundamental piece within the larger goal of development rather than as a dependent goal in and of itself. Olson’s story is missing the fact that democracy encompasses goals other than increasing GDP; it is difficult to imagine a case where the population would agree to govern collectively based on a purely rational goal of achieving a higher growth rate and ignoring the intrinsic goods of democracy. While seeking greater economic opportunity may be part of the calculation, I am skeptical of any argument that claims that people risk their lives fighting repression solely so that they can achieve a more stable growth rate in the future.
@ Man Yan: I totally agree with you, and the paper you showed me is very interesting. Thanks a lot! However, I do think McGillivray’s book has been already trying to tackle this problem. At least, she argues that the making of trade and industrial policy, redistributive in essence, is the interactive function of electoral rules and party strength, right? She does distinguish how they interact and induce four possible scenarios of democratic regimes. Even though she argues that Brazil is not really doable because of the uncertainty entailed by the PR systems with weak party, for other three types she provided very compelling and interesting stories and empirical proof. That partly explains why I find Persson and Tabellini’s article problematic. They try to argue electoral rules and forms of government have different effects (one on the degree of politicians’ accountability and the other on government’s economic and fiscal policies), they actually intertwine both dimensions in their analysis. However, due to improper organization, it is not clear what type of democracies they are trying to argue. More importantly, it is actually because overlook such nuance they fail to distinguish why sometimes there is no significant salience between presidential and parliamentary democracies (They mentioned this quite often when they summarized their research). This problem relates to my second comment. I know it is very convenient to say how you use category depends on the questions you ask, but the problem is dichotomous typology we use very often fails to tackle the real differences across political regimes. I believe that explained more or less why rather than simply rely on distinction between presidentialism and parliamentarism McGillivray chose a different way to differentiate democratic regimes. I got this idea from a research done by Cheibub and Limongi (Cheibub, Jose A., and Fernando Limongi. 2002. “Democratic Institutions and Regime Survival: Parliamentary and Presidential Democracies Reconsidered,” in Annual Review of Political Science, 5: 151-179). So you are right, as the students of comparative politics, we may need to elaborate more and specify the nuances within each category.
@ Emily: While I agree with your comments on Olson’s article and more generally the rational choice approach, I am not quite sure if your first line is what Olson really tries to argue. In my understanding, I think this paper’s merit lies in his accounts for the fact that why democracy tends to have stable economic investment, growth, and development, and the reasons he proposed to explain why autocracy is not conductive to economic growth is very good. There are mainly two things he used to demonstrate that the autocracy impedes investment and growth because compared to democracies it tends to have great uncertainty. The first thing is we do not know how far dictators are looking at because it depends on individual autocrat. Some may look at ideology, some may seek economic growth, and some may even desire the accumulation of personal fortune. Under this condition, the property rights may not protected and people may be overly expropriated by autocrats, which jointly in turn hinder development. In this sense, I do not think he does not ignore that autocrats rule for different reasons. To be fair, he relied on this fact to explain why the dictatorship is no unpredictable, and we all know unpredictability may deter investors. The second source of uncertainty comes from the problem of succession (Just look at China before the 1980s and North Korea). As there is no institutionalized mechanism to determine who will the successors, autocratic regimes tend to be highly unstable. During the times of succession, assassination and elite struggle (or even revolution) all act as possible scenes. This explains why current Chinese leaders, after the initiation of reform in the late 1970s, struggle fervently to stabilize the pattern of succession. So now scholars can better predict who will be the next Chinese president among the fifth-generation cadres. Putting both of them together, I think it may be better to say his model on autocrat’s desire to taxation maximization is more like “assumption” instead of the empirical truth. More importantly, judging from these arguments Olson made, fairly speaking I do think his article is in line the empirical world.
@ Chao-yo. Not sure I understand your comment just as I think you misinterpreted mine. "In this sense, I do not think he does not ignore that autocrats rule for different reasons"-- I don't understand what you mean here. Im assuming you mean that Olson does account for utilities other than wealth maximization in his conception of why the sedentary autocrat is better for the population than the roving autocrat? I do not. Certainly property rights are not secure under autocrats, nor am I arguing that autocracies are better for development than are democracy. However, variation within autocratic regimes is large: some of the most spectacular growth rates have been achieved under autocratic rule, as have some of the most dismal. I simply argue that his conception is too simple and that his model ignores important ideological factors. Olson's use of social choice theory is useful in that it boils down extremely complex processes to a point where we can discuss them easily, but at the same time it also creates a distance with empirical reality.
Criticisms against indicators such as GDP/N and Gini Coefficient are usually along the lines that these indicators tend to oversimplify the reality that they are trying to explain. Consequently, a flawed indicator will fail to produce a good model which will then lead to inadequate public policies. In this sense, I find the work done by Blaydes and Kayser innovative. In particular, the alternative measure they propose, average daily calorie consumption,is an effective way to measure the allocation of the gains from growth. There are few concerns, however, I would address in order to continue building from their work and perhaps arrive at a more accurate indicator.
The current concern in the nutrition literature is the difference between "empty" vs "quality" calories. In this sense, it is not enough just to know how many calories a person has available for his/her consumption, but from those calories how many truly provide nutrients. In short, calorie consumption does not equal nourishment and if we want to evaluate how economic growth affects populations, we would need a refined indicator that also distinguishes empty calories from quality ones. Blaydes and Kayser incorporte this concern to some degree by also analyzing animal calories, yet this is not enough.
A refined indicator of calorie consumption would need to consider the high correlation with poverty and bad nutrition and lack of access to healthy food choices. Further, consumption of certain foods are also associated with status. That is, an increase in income sometimes drives population to consume highly processed foods that have lost all nutritional value. For example, brown vs white rice natural vs processed sugars such as high-fructose corn syrup. Consequently, calorie consumption alone with fail to account for the fact that an increase in GDP/N could affect negatively nutrition.
Finally, and maybe to have a better idea about calorie intake here are some figures from the USDA that may contribute in understanding (or just better exemplifying) the authors' argument:
Blaydes and Kayser found that "in the long-run a one hundred dollar increase in GDP per capita in hybrid regimes yields about 170 calorie increase and in democracies a 187 calorie increase." (14)
All of the following are considered in 3 oz. amounts.
Cod Pacific Cooked..............89 calories Tuna, Yellowfin................118 Pork chop center rib, roasted..190 Ground beef 15% fat, cooked....212 Beef, top sirloin, lean........156
Source: USDA Dietary Guidelines for Americans 2005 http://www.cnpp.usda.gov/DGAs2005Guidelines.htm
First, on "Counting Calories" and related to Chao-yo. Categories almost always entail some subjectivity. Having said that, I think theirs is as plausible as other good ones (eg Epstein et al we read). Futhermore, I think their tests seems fairly robuts -granted, once you dig in the data analysis of a paper what seemed robust is not so robust anymore... Finally, calories has a difficult quality component as well as the fact that different peoples might need different amounts of calories. By this I mean that I see it is as interesting but controversial.
My main comments this week go to Olson. Lucid paper from a lucid social scientists. On to potential flaws. Strong claim: “the conditions that are needed for maximum economic development are exactly the same conditions that are needed to have a lasting democracy”. Empirically, we can see that this probably doesn’t hold today, like Emily pointed out. Why? Because autocracies that secure property rights and have a decent –even if imperfect- rule of law (like China) can grow by similar yearly relative amounts than democratic societies (like India). In the same page, he claims that “capital often flees from countries with continuing or episodic dictatorships […] to the stable democracies. Again, one can argue that property rights and certainty of expectations matter more to secure investment than whether the country is a democracy or a dictatorship. Another question is whether this countries will become democracies in the long run (like South Korea did) or not (like Singapore).
I believe the paper would benefit from a couple of things. First, he could make explicit the analogy of monarchy as a monopoly and democracy as competition. Second, it would be interesting to try to determine the point in which citizens do not accept the authoritarian ruler anymore because the taxes/costs are too high.
On Person and Tabellini, I believe this specific paper is solid at the risk of being obvious. Constitutions matter for economic performance/policy... Great! See you on Thursday.
I think Blaydes and Kayser have tried to respond to an interesting challenge. They have done so in an innovative, but also intriguing way.
First, I think it is essential to develop measures of inequality, to counterbalance not only the typical economic performance measures (like GDP per capita) but also the poverty rates. Although the latter are very important, they do no assess the gap between the worst well off and the others, which an inequality measure (such as the Gini coefficient) can do. The absence of Gini coefficients for many (poor) countries justifies the research for a new indicator, as calorie consumption.
Second, my first reaction was to be sceptical about the relevance of calorie consumption, considering all issues related to the quality of calories (which Cecila detailled, so I won’t go in details here). But I must say that by keeping thinking about it, I believe the objective of Blaydes and Kayser is not to say that higher consumption of calories make you more healthy. Rather, they are looking for a measure of redistribution. As such, I think their indicator is reaching its goal. It is not perfect, of course. But if the total calorie consumption of a country increases, I do accept their logic that this means there is better redistribution, since the rich (to simplify) are probably not the ones who could augment their consumption. In this sense, their argument regarding democracy impact appears convincing to me.
Third, considering the two points above, I do acknowledge that calorie consumption gives “some” measure of inequality, but may not be as relevant as hoped. In particular in countries with GDP lower than $10,000, I am not sure how calorie consumption can inform us on a better situation for the worst well-off. Consumption could have improved only in the “middle class” (if we can call it this way). It would be apparently impossible for us to tell who is consuming more calorie-wise. Are these the ones who need it the most? I believe there is still space to develop a better inequality measure, and that it would be important to do so.
@ Emily: I am sorry I did not make my points clear to you. Basically what I was trying to say is: While your comments are really fair, they may not necessarily mean Olson’s model is flawed. First of all, you are certainly right that autocrats rule for a lot of reasons and tax maximization is just one of them. However, in that case, how do you we can refine Olson’s model? Maybe we can place more parameters (e.g. religion, political ideology, personal desire, etc.) into an autocrat’s utility function? If so, how are we going to weight each of them in our equation? Second, do theories really have to capture everything? I do not believe a model needs to address everything that makes it exactly the same in real life for two reasons: One, many things are interrelated to each other. Even if you try to include everything, you still want to know (or have to understand) which of them weights the most. Second, formal theory, as a theory, may have more normative implications than the positive ones. More importantly, maybe the variation you mention is exactly the source of uncertainty lying within autocracies that Olson would like to tackle, and I do not see how his theory will change even if you consider these nuances into account. Autocracy is still not good for investment and development (even if they are stationery). Also, is saying that democracy is conductive to economic development the same as arguing economic development is the only goal of democracy?
Anyway, the question about how models should be tailored to the reality is definitely arguable, and we can talk more about this in class.
My comments on this week's readings will be brief. I thought McGillivray's book was excellently written, and the only real critique is that she did not devote much attention to a weak-party PR system.
Also, I agree with Chao-yo's comment in regards to the Denisova et al. article. With entrepreneurs being such a small part of the sample, is there perhaps some unseen effect on the survey's outcomes? Also, I am intrigued with the whole idea that institutions may affect personal beliefs. With such ambivalent attitudes towards privatization, Im curious if attitudes towards democratization may also differ regarding different institutional settings, and does this attitude affect democratization efforts in general?
So, two important points: McGillivray writes an amazing book because she creatively gets at dependent variables regarding stock price and then does a very effective job of modelling variation in democratic institutions and the impact of electoral systems on the ability of constituents to demand industry protection. Frankly, I was shocked that I liked it so much, given my deep and heartfelt indifference to both party systems and tariff regimes, but the elegance of her social scientific methodology was amazing.
Also of note was her apt characterization of the British pub as the equivalent of the American water cooler, which is true and also deeply tragic. Where did we go wrong here? There has to be a better way.
Oh yes -- and on the cover of the book there are a series of trade networks displayed, one of which seems to connect the Galapagos islands to Mozambique. I was unaware of such a connection, but perhaps it has to do with turtles, finches, or pub-dwelling Englishmen ... thoughts?
I must agree with Robert! I was surprised to enjoy McGillivray's book so much and impressed by her writing... The argument is built progressively; we are carried through its methods progressively, and the flaws are also presented.
One comment on the susbtance: the international dimension. It already appears as important in the analysis of tariff policy in Canada and the U.S. (common external tariffs in EU, GATT rounds decreasing tariffs, but also choice of 1970s-1980s period and of these countries). Yet, at no point is it integrated in the argument. Why? The very last sentence of the book does it in a very interesting way, according to me, but it seems kind of late. I think the argument would have been stronger if considering these international constraints all along… But maybe that’s the story of her next book?
The readings we have for this week attempt to explore how different democracies function and what political and economic implications they entail. Some researchers chose to look at a particular set of countries (i.e. Denisova et al. and McGillivray), while others took a more ambitious step to conduct (large-N) cross-national comparison. As I will argue later, in my opinion small-N comparison seems to produce more leverage since the results we have based on cross-national comparison mostly turns out to be either incomplete or confusing.
ReplyDeleteTo begin with, for Blaydes et al., although they argue average daily calorie consumption will be a better alternative to measure inequality and observe how economic growth will benefit the least well-off in a society, I am not convinced that why and how it can be a good alternative proxy to measure inequality if they had to go through such complex procedures to assure the robustness of their analysis. Researchers who use GDP per capita may have relied on similar statistic tools to assure the robustness of their findings. Also, I do not see very clearly how this article explains the conflicting results of previous empirical studies between democracy and inequality. Treating hybrid regimes as a single category is also misleading as elections in this category may not always be so competitive that dictators need to purchase the support of the least well-off.
Similarly, for Rodrik, in the first part of his article he presents a quite compelling hypothesis to explain what institutions are best suited for economic transition and development, but his proxy variables do not really approximate the conflict management function of democratic institutions. Besides, he uses South Korea and Thailand to illustrate that participatory democracies tend to better deal with financial crises, but do both of these countries really rely on their participatory political institutions to resolve economic depression? If yes, how did they do it? Rodrik only explained the connection between participatory institutions and economic transition from the results without specifying the causal mechanism. Last but not least, the intermediate level of democracy creates huge and noticeable variation in economic performance. Why?
As the cross-national comparison tends to create more confusion that demands further clarification, I hence believe that starting with small number of similar cases maybe a better approach. For example, McGillivray thoroughly tackled three different cases for each category she specified (though Brazil did not receive equal amount of attention) and did a nice job in explaining how electoral rules and party strength, when interacting with an industry's geographic characteristics, will shape politicians' incentive to protect a particular industry. I think it is a very good book especially because she is highly aware of the weakness of her analysis and tried hard not to overclaim her results.
In a similar vein, Denisova et al. focused on post-Soviet countries to explore how institutional settings will affect the difference between the support from the low-skilled and the high-skilled for revising privatization. While I think their explanations are very clear and well-written, one possible problem in their analysis is that they did not explain why substitutablility view is rejected within the special contexts of post-Soviet countries. Complementarity view may win in their work perhaps because democratization in Russia and other post-Soviet countries does not facilitate redistribution due to relatively low degree of inequality at the beginning of transition, and not all countries in other regions start economic transition with this situation. They may also need to explain why the entrepreneurs and managers only occupy a small proportion of the total respondents, and how they may affect their results. The last but certainly not least problem is: why is it legitimate to assume democracy and good governance go along together?
Following my last comment, two things are brought out that I think worthwhile for further discussion: First of all, many scholars differentiate political regimes along two dimensions (e.g. forms of government and quality of governance; electoral rules and forms of government; electoral rules and party strength, etc.). While we may follow these dimensions to explore how they affect politicians' behaviors and government decision-making, like Boix did in Democracy and Redistribution, I found it surprising that few have carefully tackle the interaction of the two dimensions they propose (Joan made a similar point last week). Especially for Persson and Tabellini's piece, they constantly draw both dimensions together in their analysis but separate them in different sections, causing much confusion and unsatisfying results. Second, does the dichotomous typology widely employed by political scientists, especially those conducting quantitative analysis, really capture the variation across different political regimes? More specifically, is it really fruitful to separate regimes into democracy vs. autocracy or presidentialism vs. parliamentarism?
ReplyDelete@Chao-yo: It is true that thus far, few scholars have investigated the interaction effects between different independent variables, and in turn, how these effects could influence policy outcomes such as politicians' behaviour and government decision-making. However, I did not find it that surprising because I thought it would be natural for scholars to first focus on the individual independent variables before they conduct further research on the interaction effects between these variables. That said, some scholars have picked up on this shortcoming and studied the interaction effects between variables. An example would be Joachim Wehner's study of the interaction effects between size fragmentation (number of decision makers) and procedural fragmentation (the structure of the process in which actors interact) within the legislature and how this influences fiscal policymaking and thus budget deficits. I think it would be an interesting article to read, especially since we are focussing on how institutions can affect economic policy outcomes in this lesson. The full text pdf is on this website: http://cps.sagepub.com/content/early/2009/11/25/0010414009347828.short
ReplyDeleteRegarding Chao-yo's second question on the usefulness of a dichotomous typology in studying political regimes, my view is that the usefulness of this approach depends very much on the specific objective of the paper and the context in which it was written. The advantage of using a dichotomous measure is that it allows scholars to directly compare two extreme scenarios and this contrast could make it easier to discern differences in the variables' impact on policy outcomes, which is probably very useful for preliminary research and for providing a basis which further research could then build upon. An analogy would be how economists have built many models and theories based on perfect competition as an industry structure; clearly there are few industries in the world where perfect competition holds completely true, but it is nevertheless a useful theoretical concept and a benchmark against which we could compare reality, precisely because of its extreme qualities. The same applies to autocracies and democracies--we could always employ a dichotomous typology as a "first cut" and build upon the findings subsequently.
Moving on to my comments and questions about this week's readings, I find the notion of institutional convergence mentioned briefly in Rodrik's conclusion to be very interesting. Most papers have focussed on how different institutional setups, e.g. different regime types, different electoral rules and types of government (Persson & Tabellini), could have different effects on policy outcomes, but few have explicitly discussed the extent and desirability of institutional convergence between developing and developed economies and amongst developed economies themselves.
ReplyDeleteA salient example would be European integration, which demands a high degree of institutional convergence and the pursuit of similar policies spelt out for instance in the Stability and Growth Pact. However, each country has different structural attributes e.g. different labor market dynamics, and differences amongst members are frequently observed, perhaps more noticeably between the "core" and "peripheral" members. Indeed, cases such as Greece illustrate the importance of ensuring the compatibility of institutional convergence with local conditions and needs--a point highlighted by Rodrik.
Hence another important question for Comparative Politics would be: how desirable is institutional convergence? Although many studies have demonstrated the benefits of pursuing democratic ideals and institutions, and market liberalization, to what extent is this desirable for non-Western countries? Even within developed economies, to what extent would it be beneficial for countries to pursue similar institutions, ie what are the gains (compared to the costs) of institutional convergence, particularly in light of the rapid financial and economic globalisation that we have witnessed within the past decade?
Mancur Olson’s rational choice conception of leader’s incentives and taxation maximization lead him to argue that autocracies will rarely have good growth rates for more than a generation. In contrast, the conditions necessary for a stable democracy are also conducive to good economic growth rates. Olson’s argument regarding the growth under benevolent dictators is convincing, but also empirically flawed. First, Olson models exploitation by the autocrat exclusively from the point of taxation and disregards any other incentives the autocrat might have. If we take into account other possible incentives of autocrats (ideology, prestige, international pressure), it is clear that decisions are not made with the exclusive idea of maximizing taxation revenue. Further, Olson’s conception of the benevolent autocrat excludes extractive regimes where instead of relying on taxation for rents, the regime is able to benefit directly from the resource itself, alienating the population from governance, creating a huge services gap and driving down incentives to develop other sectors of the economy. In the case of kleptocratic autocratic regimes the population does not desire “long live the king” because the autocrat’s only desire is to steal as much as possible while he is in power and has no incentive to increase taxable income. Also problematic is Olson’s conception about how democratic regimes emerge. He claims that a balance of power or a stalemate among competing small-scale autocrat will result in a situation when the only solution is to “engage in fruitless fighting or to work out a truce with mutual toleration” (573). Ironically, Olson seems to neglect the collective action problem and does not provide an adequate explanation for why these leaders would have a common interest in establishing an independent judiciary and elections. In fact, it seems counterintuitive that the autocrats of small regions would be willing to cede power with no guarantee of certain power sharing (though this may explain why PR would be more likely than majoritarian government). Olson’s story doesn’t make sense in a purely rational choice conception. This piece, along with the others we read for today’s class treat democracy as a fundamental piece within the larger goal of development rather than as a dependent goal in and of itself. Olson’s story is missing the fact that democracy encompasses goals other than increasing GDP; it is difficult to imagine a case where the population would agree to govern collectively based on a purely rational goal of achieving a higher growth rate and ignoring the intrinsic goods of democracy. While seeking greater economic opportunity may be part of the calculation, I am skeptical of any argument that claims that people risk their lives fighting repression solely so that they can achieve a more stable growth rate in the future.
ReplyDelete@ Man Yan: I totally agree with you, and the paper you showed me is very interesting. Thanks a lot! However, I do think McGillivray’s book has been already trying to tackle this problem. At least, she argues that the making of trade and industrial policy, redistributive in essence, is the interactive function of electoral rules and party strength, right? She does distinguish how they interact and induce four possible scenarios of democratic regimes. Even though she argues that Brazil is not really doable because of the uncertainty entailed by the PR systems with weak party, for other three types she provided very compelling and interesting stories and empirical proof. That partly explains why I find Persson and Tabellini’s article problematic. They try to argue electoral rules and forms of government have different effects (one on the degree of politicians’ accountability and the other on government’s economic and fiscal policies), they actually intertwine both dimensions in their analysis. However, due to improper organization, it is not clear what type of democracies they are trying to argue. More importantly, it is actually because overlook such nuance they fail to distinguish why sometimes there is no significant salience between presidential and parliamentary democracies (They mentioned this quite often when they summarized their research).
ReplyDeleteThis problem relates to my second comment. I know it is very convenient to say how you use category depends on the questions you ask, but the problem is dichotomous typology we use very often fails to tackle the real differences across political regimes. I believe that explained more or less why rather than simply rely on distinction between presidentialism and parliamentarism McGillivray chose a different way to differentiate democratic regimes. I got this idea from a research done by Cheibub and Limongi (Cheibub, Jose A., and Fernando Limongi. 2002. “Democratic Institutions and Regime Survival: Parliamentary and Presidential Democracies Reconsidered,” in Annual Review of Political Science, 5: 151-179). So you are right, as the students of comparative politics, we may need to elaborate more and specify the nuances within each category.
@ Emily: While I agree with your comments on Olson’s article and more generally the rational choice approach, I am not quite sure if your first line is what Olson really tries to argue. In my understanding, I think this paper’s merit lies in his accounts for the fact that why democracy tends to have stable economic investment, growth, and development, and the reasons he proposed to explain why autocracy is not conductive to economic growth is very good. There are mainly two things he used to demonstrate that the autocracy impedes investment and growth because compared to democracies it tends to have great uncertainty. The first thing is we do not know how far dictators are looking at because it depends on individual autocrat. Some may look at ideology, some may seek economic growth, and some may even desire the accumulation of personal fortune. Under this condition, the property rights may not protected and people may be overly expropriated by autocrats, which jointly in turn hinder development. In this sense, I do not think he does not ignore that autocrats rule for different reasons. To be fair, he relied on this fact to explain why the dictatorship is no unpredictable, and we all know unpredictability may deter investors. The second source of uncertainty comes from the problem of succession (Just look at China before the 1980s and North Korea). As there is no institutionalized mechanism to determine who will the successors, autocratic regimes tend to be highly unstable. During the times of succession, assassination and elite struggle (or even revolution) all act as possible scenes. This explains why current Chinese leaders, after the initiation of reform in the late 1970s, struggle fervently to stabilize the pattern of succession. So now scholars can better predict who will be the next Chinese president among the fifth-generation cadres. Putting both of them together, I think it may be better to say his model on autocrat’s desire to taxation maximization is more like “assumption” instead of the empirical truth. More importantly, judging from these arguments Olson made, fairly speaking I do think his article is in line the empirical world.
ReplyDelete@ Chao-yo. Not sure I understand your comment just as I think you misinterpreted mine. "In this sense, I do not think he does not ignore that autocrats rule for different reasons"-- I don't understand what you mean here. Im assuming you mean that Olson does account for utilities other than wealth maximization in his conception of why the sedentary autocrat is better for the population than the roving autocrat? I do not. Certainly property rights are not secure under autocrats, nor am I arguing that autocracies are better for development than are democracy. However, variation within autocratic regimes is large: some of the most spectacular growth rates have been achieved under autocratic rule, as have some of the most dismal. I simply argue that his conception is too simple and that his model ignores important ideological factors. Olson's use of social choice theory is useful in that it boils down extremely complex processes to a point where we can discuss them easily, but at the same time it also creates a distance with empirical reality.
ReplyDeleteCriticisms against indicators such as GDP/N and Gini Coefficient are usually along the lines that these indicators tend to oversimplify the reality that they are trying to explain. Consequently, a flawed indicator will fail to produce a good model which will then lead to inadequate public policies. In this sense, I find the work done by Blaydes and Kayser innovative. In particular, the alternative measure they propose, average daily calorie consumption,is an effective way to measure the allocation of the gains from growth.
ReplyDeleteThere are few concerns, however, I would address in order to continue building from their work and perhaps arrive at a more accurate indicator.
The current concern in the nutrition literature is the difference between "empty" vs "quality" calories. In this sense, it is not enough just to know how many calories a person has available for his/her consumption, but from those calories how many truly provide nutrients. In short, calorie consumption does not equal nourishment and if we want to evaluate how economic growth affects populations, we would need a refined indicator that also distinguishes empty calories from quality ones. Blaydes and Kayser incorporte this concern to some degree by also analyzing animal calories, yet this is not enough.
A refined indicator of calorie consumption would need to consider the high correlation with poverty and bad nutrition and lack of access to healthy food choices. Further, consumption of certain foods are also associated with status. That is, an increase in income sometimes drives population to consume highly processed foods that have lost all nutritional value. For example, brown vs white rice natural vs processed sugars such as high-fructose corn syrup. Consequently, calorie consumption alone with fail to account for the fact that an increase in GDP/N could affect negatively nutrition.
Finally, and maybe to have a better idea about calorie intake here are some figures from the USDA that may contribute in understanding (or just better exemplifying) the authors' argument:
Blaydes and Kayser found that "in the long-run a one hundred dollar increase in GDP per capita in hybrid regimes yields about 170 calorie increase and in democracies a 187 calorie increase." (14)
All of the following are considered in 3 oz. amounts.
Cod Pacific Cooked..............89 calories
Tuna, Yellowfin................118
Pork chop center rib, roasted..190
Ground beef 15% fat, cooked....212
Beef, top sirloin, lean........156
Source: USDA Dietary Guidelines for Americans 2005
http://www.cnpp.usda.gov/DGAs2005Guidelines.htm
First, on "Counting Calories" and related to Chao-yo. Categories almost always entail some subjectivity. Having said that, I think theirs is as plausible as other good ones (eg Epstein et al we read). Futhermore, I think their tests seems fairly robuts -granted, once you dig in the data analysis of a paper what seemed robust is not so robust anymore... Finally, calories has a difficult quality component as well as the fact that different peoples might need different amounts of calories. By this I mean that I see it is as interesting but controversial.
ReplyDeleteMy main comments this week go to Olson. Lucid paper from a lucid social scientists. On to potential flaws. Strong claim: “the conditions that are needed for maximum economic development are exactly the same conditions that are needed to have a lasting democracy”. Empirically, we can see that this probably doesn’t hold today, like Emily pointed out. Why? Because autocracies that secure property rights and have a decent –even if imperfect- rule of law (like China) can grow by similar yearly relative amounts than democratic societies (like India). In the same page, he claims that “capital often flees from countries with continuing or episodic dictatorships […] to the stable democracies. Again, one can argue that property rights and certainty of expectations matter more to secure investment than whether the country is a democracy or a dictatorship. Another question is whether this countries will become democracies in the long run (like South Korea did) or not (like Singapore).
I believe the paper would benefit from a couple of things. First, he could make explicit the analogy of monarchy as a monopoly and democracy as competition. Second, it would be interesting to try to determine the point in which citizens do not accept the authoritarian ruler anymore because the taxes/costs are too high.
On Person and Tabellini, I believe this specific paper is solid at the risk of being obvious. Constitutions matter for economic performance/policy... Great! See you on Thursday.
I think Blaydes and Kayser have tried to respond to an interesting challenge. They have done so in an innovative, but also intriguing way.
ReplyDeleteFirst, I think it is essential to develop measures of inequality, to counterbalance not only the typical economic performance measures (like GDP per capita) but also the poverty rates. Although the latter are very important, they do no assess the gap between the worst well off and the others, which an inequality measure (such as the Gini coefficient) can do. The absence of Gini coefficients for many (poor) countries justifies the research for a new indicator, as calorie consumption.
Second, my first reaction was to be sceptical about the relevance of calorie consumption, considering all issues related to the quality of calories (which Cecila detailled, so I won’t go in details here). But I must say that by keeping thinking about it, I believe the objective of Blaydes and Kayser is not to say that higher consumption of calories make you more healthy. Rather, they are looking for a measure of redistribution. As such, I think their indicator is reaching its goal. It is not perfect, of course. But if the total calorie consumption of a country increases, I do accept their logic that this means there is better redistribution, since the rich (to simplify) are probably not the ones who could augment their consumption. In this sense, their argument regarding democracy impact appears convincing to me.
Third, considering the two points above, I do acknowledge that calorie consumption gives “some” measure of inequality, but may not be as relevant as hoped. In particular in countries with GDP lower than $10,000, I am not sure how calorie consumption can inform us on a better situation for the worst well-off. Consumption could have improved only in the “middle class” (if we can call it this way). It would be apparently impossible for us to tell who is consuming more calorie-wise. Are these the ones who need it the most? I believe there is still space to develop a better inequality measure, and that it would be important to do so.
@ Emily: I am sorry I did not make my points clear to you. Basically what I was trying to say is: While your comments are really fair, they may not necessarily mean Olson’s model is flawed. First of all, you are certainly right that autocrats rule for a lot of reasons and tax maximization is just one of them. However, in that case, how do you we can refine Olson’s model? Maybe we can place more parameters (e.g. religion, political ideology, personal desire, etc.) into an autocrat’s utility function? If so, how are we going to weight each of them in our equation? Second, do theories really have to capture everything? I do not believe a model needs to address everything that makes it exactly the same in real life for two reasons: One, many things are interrelated to each other. Even if you try to include everything, you still want to know (or have to understand) which of them weights the most. Second, formal theory, as a theory, may have more normative implications than the positive ones. More importantly, maybe the variation you mention is exactly the source of uncertainty lying within autocracies that Olson would like to tackle, and I do not see how his theory will change even if you consider these nuances into account. Autocracy is still not good for investment and development (even if they are stationery). Also, is saying that democracy is conductive to economic development the same as arguing economic development is the only goal of democracy?
ReplyDeleteAnyway, the question about how models should be tailored to the reality is definitely arguable, and we can talk more about this in class.
My comments on this week's readings will be brief. I thought McGillivray's book was excellently written, and the only real critique is that she did not devote much attention to a weak-party PR system.
ReplyDeleteAlso, I agree with Chao-yo's comment in regards to the Denisova et al. article. With entrepreneurs being such a small part of the sample, is there perhaps some unseen effect on the survey's outcomes? Also, I am intrigued with the whole idea that institutions may affect personal beliefs. With such ambivalent attitudes towards privatization, Im curious if attitudes towards democratization may also differ regarding different institutional settings, and does this attitude affect democratization efforts in general?
So, two important points: McGillivray writes an amazing book because she creatively gets at dependent variables regarding stock price and then does a very effective job of modelling variation in democratic institutions and the impact of electoral systems on the ability of constituents to demand industry protection. Frankly, I was shocked that I liked it so much, given my deep and heartfelt indifference to both party systems and tariff regimes, but the elegance of her social scientific methodology was amazing.
ReplyDeleteAlso of note was her apt characterization of the British pub as the equivalent of the American water cooler, which is true and also deeply tragic. Where did we go wrong here? There has to be a better way.
Oh yes -- and on the cover of the book there are a series of trade networks displayed, one of which seems to connect the Galapagos islands to Mozambique. I was unaware of such a connection, but perhaps it has to do with turtles, finches, or pub-dwelling Englishmen ... thoughts?
ReplyDeleteI must agree with Robert! I was surprised to enjoy McGillivray's book so much and impressed by her writing... The argument is built progressively; we are carried through its methods progressively, and the flaws are also presented.
ReplyDeleteOne comment on the susbtance: the international dimension. It already appears as important in the analysis of tariff policy in Canada and the U.S. (common external tariffs in EU, GATT rounds decreasing tariffs, but also choice of 1970s-1980s period and of these countries). Yet, at no point is it integrated in the argument. Why? The very last sentence of the book does it in a very interesting way, according to me, but it seems kind of late. I think the argument would have been stronger if considering these international constraints all along… But maybe that’s the story of her next book?