Inequality and democracy are far more compatible empirically than social conflict theory predicts. This article speaks to this puzzle, identifying the scope conditions under which democratization induces greater redistribution. Because autocrats sometimes have incentives to expropriate economic elites, who lack reliable institutions to protect their rights, elites may prefer democracy to autocratic rule if they can impose roadblocks to redistribution under democracy ex ante. Using global panel data (1972–2008), this study finds that there is a relationship between democracy and redistribution only if elites are politically weak during a transition; for example, when there is revolutionary pressure. Redistribution is also greater if a democratic regime can avoid adopting and operating under a constitution written by outgoing elites and instead create a new constitution that redefines the political game. This finding holds across three different measures of redistribution and instrumental variables estimation. This article also documents the ways in which elites ‘bias’ democratic institutions.
(Online publication May 23 2013)
* Department of Political Science, University of Chicago (email: [email protected]); Department of Political Science, University of Washington (email: [email protected]). Research support was provided by the Hoover Institution, where Menaldo was a National Fellow in 2009–2010, and Stanford University's Center on Development, Democracy and the Rule of Law, where Albertus was a Postdoctoral Fellow in 2011–2012. Able research assistance was provided by Jennifer Noveck. Earlier drafts of this article were presented at the 2010 American Political Science Association Annual Meeting and at Georgetown University's CRITICS workshop. We thank Jim Fearon, Steve Haber, David Laitin, Margaret Levi, Paul Musgrave, Dan Slater, Milan Slovik and Joe Wright for helpful comments on earlier drafts. An online appendix for this article containing additional statistical analyses and a discussion of sources and methods is available at http://dx.doi.org/doi:10.1017/S0007123413000124. Data and supporting materials necessary to reproduce the numerical results in the article are available at http://dx.doi.org/doi:10.1017/S0007123413000124.