Inequality, extractive institutions, and growth in nondemocratic regimes
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- 作者：Nobuhiro Mizuno ; Katsuyuki Naito ; Ryosuke Okazawa
- 关键词：Dictatorship ; Economic growth ; Inequality ; Institutions
- 刊名：Public Choice
- 出版年：2017
- 出版时间：January 2017
- 年：2017
- 卷：170
- 期：1-2
- 页码：115-142
- 全文大小：1,122 KB
- 刊物类别：Business and Economics
- 刊物主题：Economics
Public Finance and Economics
Political Science - 出版者：Springer Netherlands
- ISSN：1573-7101
- 卷排序：170
文摘
This study investigates the effect of income inequality on economic growth in nondemocratic regimes. We provide a model in which a self-interested ruler chooses an institution that constrains his or her policy choice. The ruler must care about the extent of citizens’ support in order to remain in power. Under an extractive institution, the ruler can extract a large share of citizens’ wealth, but faces a high probability of losing power because of low public support. We show that inequality affects the ruler’s tradeoff between the expropriation of citizens’ wealth and his or her hold on power. Substantial inequality among citizens makes support for the ruler inelastic with respect to his or her institutional choice. The ruler therefore chooses an extractive institution, which impedes investment and growth. These results provide an explanation for the negative relationship between inequality and growth as well as the negative relationship between inequality and institutional quality, both of which are observed in nondemocratic countries.