The Political Economy of Liberal Democracy

Sharun Mukand and Dani Rodrik

No 6433, CESifo Working Paper Series from CESifo

Abstract: We distinguish between three sets of rights – property rights, political rights, and civil rights – and provide a taxonomy of political regimes. The distinctive nature of liberal democracy is that it protects civil rights (equality before the law for minorities) in addition to the other two. When democratic transitions are the product of a settlement between the elite (who care mostly about property rights) and the majority (who care mostly about political rights), they generically fail to produce liberal democracy. This is because the minority has neither the resources nor the numbers to make a contribution to the settlement. We develop a formal model to sharpen the contrast between electoral and liberal democracies and highlight circumstances under which liberal democracy can emerge. We show that liberal democracy requires quite special circumstances: mild levels of income inequality as well as weak identity cleavages. We provide some evidence consistent with this result, and also present a new classification of countries as electoral or liberal democracies.

JEL-codes: P48 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-mic, nep-pke and nep-pol
References: Add references at CitEc
Citations: View citations in EconPapers (7)

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Related works:
Journal Article: The Political Economy of Liberal Democracy (2020)
Working Paper: The Political Economy of Liberal Democracy (2015)
Working Paper: THE POLITICAL ECONOMY OF LIBERAL DEMOCRACY (2015)
Working Paper: The Political Economy of Liberal Democracy (2015)
Working Paper: The Political Economy of Liberal Democracy (2015)
Working Paper: The Political Economy of Liberal Democracy (2015)
Working Paper: The Political Economy of Liberal Democracy (2015)
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