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Thread: How GDP per capita can influence the stability of a democracy

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    Post How GDP per capita can influence the stability of a democracy



    Adam Przeworski, a Polish-American professor of political science at New York University, has written several papers and books regarding the relationship between economic prosperity and the stability of democratic regimes. He was able to calculate the life expectancy of a democracy based on average annual income per capita. It would last in average for 8 years with a GDP per capita of less than $1,500, and 18 years when GDP per capita was comprised between $1,500 and $3,000. Once the $6,000 threshold was reached, there was only one in five hundred chance that a democracy would be replaced by an authoritarian regime. And no one has ever seen democracy disappear from a country where the GDP per capita exceeded $9,000 (source: Democracy as an equilibrium, Adam Przeworski 2004).

    Naturally, wealth by itself does not guarantee democracy, as exemplified by Gulf countries. But once democracy has set in, dislodging it in a reasonably affluent society appears to be difficult.

    The study does not mention whether the GDP per capita was nominal or at PPP, and whether it should be adjusted for inflation since the study was published or if those values still hold. However it does say that Argentina had a per capita income of $6,055 in 1975, and after looking it up it corresponds to the GDP per capita at PPP (the nominal was only $2,000).

    Nowadays, the countries that have a GDP per capita at PPP lower than $ 6,000 are mostly confined to Africa. On the American continent, only Nicaragua, Honduras and Haiti fall in that category, and barely for the two first. In Asia, that includes only Cambodia, Nepal, Kyrgyzstan, Tajikistan, Afghanistan, Syria and Yemen.

    (If we consider nominal GDP per capita, the list is longer and includes bigger countries like India, Pakistan, Bangladesh, Indonesia, and even parts of Europe like Georgia, Ukraine, Bosnia, Albania and Kosovo.)

    This is hugely interesting since there really seems to be a correlation between GDP per capita at PPP and the Democracy Index. Compare the maps.










    Based on this, some countries that have never been democracies are ripe for a change. Obviously it does not depend only on wealth. The level of societal development (see spiral dynamics) may be a better indicator of a country's maturity toward democracy. To reach the orange meme of the spiral dynamics (science, technology, progress, liberalism, capitalism) is what really motivates a population to adopt democracy. That is why oil-rich countries from the Arabian peninsula did not become democracies despite their wealth.

    Democracy requires enough education, economic freedom and liberties in general to reach the orange meme. To assess this, I will look into the Education Index, Economic Freedom of the World Index and Human Freedom Index. This should give is a good idea of what countries are ready for a democratic transition.

    In Europe, the best candidate appears to be Belarus, which has a GDP per capita at PPP of $21,000 (IMF 2020), higher than Argentina or Brazil. It ranks 26th worldwide for education, higher than Austria, Spain, Italy or Luxembourg. Its score of economic freedom is 6.64 out of 10 (better than Greece or South Africa). It scores 6.65 in Human Freedom, better than Turkey, Thailand or Brazil. Yet its democracy index is horrible (2.48/10, 150th worldwide, below Afghanistan and Sudan!).

    In the Middle East, Qatar, Jordan and Kuwait look the closest to reaching democratic maturity.
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    How GDP per capita can influence the stability of a democracy

    Wealth and democracy are not related. Western countries were wealthy even when they were monarchies. Wealth was not build due to democracy and democracy did not make them wealthier.....I agree that democracy provides stability in long term.


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    Quote Originally Posted by blevins13 View Post
    Wealth and democracy are not related. Western countries were wealthy even when they were monarchies. Wealth was not build due to democracy and democracy did not make them wealthier.....I agree that democracy provides stability in long term.
    GDP per capita has grown tremendously over the last 150 years. Have a look at the economic growth data from Our World in Data. The first country to enjoy a GDP per capita (PPP) of $6,000 was Switzerland in 1862, followed by Australia in 1872, the United Kingdom in 1881, New Zealand in 1882, the Netherlands in 1896, the USA in 1899, Belgium and Germany in 1900. France only reached that level in 1923, Italy in 1939, Spain in 1958, and Japan in 1960.

    GDP-capita-PPP-1875-2016.jpg

    As of 2020, Albania has a GDP per capita at PPP of $14,866 according to the IMF. The first country in history to reach the current wealth of Albanians was the USA in 1942! In Europe it was Germany in 1960. So Albanians today are far wealthier than the average American, Briton, French or German in the early 20th century.
    Last edited by Maciamo; 09-07-20 at 14:05.

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    There is at least one country that did change from a democracy (well actually a hybrid regime based on the definition of the Democracy Index) to an authoritarian regime despite having a GDP per capita well above $ 9,000. That is Venezuela in recent years. It was still listed as a hybrid regime in 2016, then fell into authoritarianism in 2017. It's GDP per capita at PPP had reached $ 17,000 in 2008. I couldn't find any data more recent than 2014, since the economy collapsed. But it could well be that a sharp drop of GDP per capita accompanied the loss of democracy.

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    Quote Originally Posted by Maciamo View Post
    There is at least one country that did change from a democracy (well actually a hybrid regime based on the definition of the Democracy Index) to an authoritarian regime despite having a GDP per capita well above $ 9,000. That is Venezuela in recent years. It was still listed as a hybrid regime in 2016, then fell into authoritarianism in 2017. It's GDP per capita at PPP had reached $ 17,000 in 2008. I couldn't find any data more recent than 2014, since the economy collapsed. But it could well be that a sharp drop of GDP per capita accompanied the loss of democracy.
    Venezuela's GDP is estimated to have fallen almost 70% since its crisis began roughly in 2012-2013 IIRC. I think no country without a total war has experienced that at least since the 19th century. Truly terrible story. Some say those numbers are exaggerated, but whatever the real numbers are, it must be a steep decline, since so many of them are willing to flee to a country in deep economic crisis like Brazil since 2015, thousands of them even becoming homeless beggars in one of Brazil's poorer states, Roraima (which borders Venezuela), and still thinking that's better than going back to Venezuela.

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    As Rutger Bregman states in his book Utopia for Realists (another must read): "Up to a per capita GDP of roughly $5,000 a year, life expectancy increases more or less automatically. But once there’s enough food on the table, a roof that doesn’t leak, and clean running water to drink, economic growth is no longer a guarantor of welfare. From that point on, equality is a much more accurate predictor."

    The link between the $6,000 annual income requirement for a democracy to work on the long term and life expectancy rising steadily with incomes up to $5,000 is interesting.

    The World Economic Forum has an article listing the world’s oldest democracies with the year they became actual, fully-fledged democracies.




    Now let's see what the GDP per capita (PPP) was the year each of these countries became democracies.

    Country Became a democracy in... GDP per capita (PPP) that year
    United States 1789 < $1900
    Switzerland 1848 ± $5,000
    New Zealand 1857 < $5,000
    Canada 1867 ± $2,800
    United States 1870 (Black Suffrage) $3,736
    United Kingdom 1885 $6,012
    Luxembourg 1890 ? (probably similar to Belgium)
    Belgium 1894 $5,689
    Netherlands 1897 $6,119
    Norway 1900 $6,141
    Australia 1901 $6,974
    Denmark 1901 $5,578
    Sweden 1911 $4,403
    Finland 1917 $2,559
    Iceland 1918 ?
    Ireland 1922 $5,255
    San Marino 1945 ? (surely higher than Italy)
    Austria 1946 $3,392 (was $7,199 in 1944)
    France 1946 $6,342 (was $7,885 in 1939)
    Italy 1946 $4,406 (was $6,076 in 1939)
    Israel 1948 ± $4,000
    Costa Rica 1949 $3,282
    India 1950 $824
    Japan 1952 $3,677 (was $4,440 in 1943)
    Colombia 1958 $4,026
    Jamaica 1962 $5,298

    It is amazing that in most cases democracy was achieved when the GDP per capita was between $4,000 and $7,000. The only countries that managed to establish a democratic regime with a lower GDP per capita were the USA, Canada, Finland, Costa Rica and India.

    The case of the USA is special as it was the earliest modern democracy and its establishment coincided with its independence from the UK. Canada, Finland and India were also cases of independence. As for Costa Rica, it was the closest of the five to the bar of the $4,000.
    Last edited by Maciamo; 11-07-20 at 12:10.

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    At least some of the wealth of most Western Countries was accumulated in criminal way, colonialism, theft, , wars... Take for instance a very wealthy, innocent looking, democracy mirage deceiving Switzerland! For hundred of years this country was the shelter of criminal money of the world. Killers, thieves, gangster's had a safe heaven for their money which build Switzerland by the way. No one cared for the blood this money had
    !Or take for instance a hybrid small country called Belgium which accumulated their wealth robing their colonies, and never payed a dime for their crimes...And guess what?! These countries called themselves functioning democracies. Yes, the wealth make the country stable, not democracy. Democracy is a very fluid definition.

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    Quote Originally Posted by DuPidh View Post
    At least some of the wealth of most Western Countries was accumulated in criminal way, colonialism, theft, , wars... Take for instance a very wealthy, innocent looking, democracy mirage deceiving Switzerland! For hundred of years this country was the shelter of criminal money of the world. Killers, thieves, gangster's had a safe heaven for their money which build Switzerland by the way. No one cared for the blood this money had
    !Or take for instance a hybrid small country called Belgium which accumulated their wealth robing their colonies, and never payed a dime for their crimes...And guess what?! These countries called themselves functioning democracies. Yes, the wealth make the country stable, not democracy. Democracy is a very fluid definition.
    All countries have a past tainted with wars and looting. This is deeply rooted in human nature since prehistory, when hunter-gatherers went on raids to massacre each others and kidnap and/or rape the women of the defeated tribe. Some would say in also shared with other cousins the chimpanzees, who also wage wars on each other's tribes.

    Since the Copper Age (for the Mayas, Aztecs, Sumerians and Egyptians) and Bronze Age (elsewhere) humans have also invented slavery, which prospered through the Classical Antiquity and was the foundation of all great ancient civilisations (not just in the West, but also in India and China). Democracy in ancient Greece and Rome could not have emerged without slaves supporting a class of citizens with enough wealth and time to get a proper education and spend their adult life discussing politics. The same was true of the Vikings, who also ruled themselves as a sort of democracy through the Thing, but who happily enslaved people they conquered.

    You berate Switzerland for its banks accepting money from criminals, but this is true of most banks anywhere in the world. When we look at the facts, the Swiss themselves have very certainly committed less atrocities in the last 500 years than most other Europeans, if only because they did not become colonial powers and stayed neutral during the great conflicts that tore apart Europe (Thirty Years' War, Seven Years' War, WWI, WWII, just to cite the worst).

    As for Belgium's colonialism, the vast majorities of the atrocities committed in Congo were during the Congo Free State (1885-1908) period, when Congo was the private colony of King Leopold II, where he could rule as an absolute monarch. The Belgian state had nothing to do with it. When Leopold II died, he was booed at his funeral and the Belgian government nationalised the Congo Free State in an attempt to mend things. The new Belgian Congo turned it into a model colony, building schools, hospitals, infrastructure... Belgian colonists generally did all they could to undo the wrongs committed by Leopold II and maintaining the peace in the region. Things would be much worse after the independence of Congo in 1960, as dictatorship and civil war caused millions of deaths. Wikipedia lists 10 separate conflicts in Congo since 1960. The worst appears to have been the Second Congo War, which saw 2.7–5.4 million excess deaths between 1998 and 2008.

    Note also that Leopold II's father was German and his mother was French (of the Bourbon-Orléans royal family). He was not an ethnic Belgian.

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    Quote Originally Posted by Maciamo View Post
    All countries have a past tainted with wars and looting. This is deeply rooted in human nature since prehistory, when hunter-gatherers went on raids to massacre each others and kidnap and/or rape the women of the defeated tribe. Some would say in also shared with other cousins the chimpanzees, who also wage wars on each other's tribes.

    Since the Copper Age (for the Mayas, Aztecs, Sumerians and Egyptians) and Bronze Age (elsewhere) humans have also invented slavery, which prospered through the Classical Antiquity and was the foundation of all great ancient civilisations (not just in the West, but also in India and China). Democracy in ancient Greece and Rome could not have emerged without slaves supporting a class of citizens with enough wealth and time to get a proper education and spend their adult life discussing politics. The same was true of the Vikings, who also ruled themselves as a sort of democracy through the Thing, but who happily enslaved people they conquered.

    You berate Switzerland for its banks accepting money from criminals, but this is true of most banks anywhere in the world. When we look at the facts, the Swiss themselves have very certainly committed less atrocities in the last 500 years than most other Europeans, if only because they did not become colonial powers and stayed neutral during the great conflicts that tore apart Europe (Thirty Years' War, Seven Years' War, WWI, WWII, just to cite the worst).

    As for Belgium's colonialism, the vast majorities of the atrocities committed in Congo were during the Congo Free State (1885-1908) period, when Congo was the private colony of King Leopold II, where he could rule as an absolute monarch. The Belgian state had nothing to do with it. When Leopold II died, he was booed at his funeral and the Belgian government nationalised the Congo Free State in an attempt to mend things. The new Belgian Congo turned it into a model colony, building schools, hospitals, infrastructure... Belgian colonists generally did all they could to undo the wrongs committed by Leopold II and maintaining the peace in the region. Things would be much worse after the independence of Congo in 1960, as dictatorship and civil war caused millions of deaths. Wikipedia lists 10 separate conflicts in Congo since 1960. The worst appears to have been the Second Congo War, which saw 2.7–5.4 million excess deaths between 1998 and 2008.

    Note also that Leopold II's father was German and his mother was French (of the Bourbon-Orléans royal family). He was not an ethnic Belgian.
    \


    Its not true wealth promotes or adds value to democracy. Take United States, one of top wealthy countries of the world. Is US democracy stronger or stable because of the money? Not necessary. Unless a formula is found to distribute more fairly the wealth the democracy is weaker not stronger. Bezos is approaching $200 billion dollars in his portfolio, and Bezos with his 10% of people like him with considerable money own 80% of money in USA. Now you tell me did Bezos money made happier the pour Americans? Or their democracy? Or take the parliaments of any western country, how many pour people make it to assembly because of their ideas? Most of parliamentarians around the west are rich people. So the rich legislate for the pour! To be a parliamentarian you have to have money otherwise you will not make it. I would agree the wealthier the countries the stronger the armies. but not democracy.

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    Quote Originally Posted by DuPidh View Post
    \


    Its not true wealth promotes or adds value to democracy. Take United States, one of top wealthy countries of the world. Is US democracy stronger or stable because of the money? Not necessary. Unless a formula is found to distribute more fairly the wealth the democracy is weaker not stronger. Bezos is approaching $200 billion dollars in his portfolio, and Bezos with his 10% of people like him with considerable money own 80% of money in USA. Now you tell me did Bezos money made happier the pour Americans? Or their democracy? Or take the parliaments of any western country, how many pour people make it to assembly because of their ideas? Most of parliamentarians around the west are rich people. So the rich legislate for the pour! To be a parliamentarian you have to have money otherwise you will not make it. I would agree the wealthier the countries the stronger the armies. but not democracy.
    You are completely missing the point of this thread. I haven't talked anywhere about the quality of democracy, not socio-economic inequalities, happiness, or anything of the sort. The only point being discussed here is: When is a country wealthy enough to become a democracy? (and remain it for the foreseeable future, not like the democracy established during the French Revolution which only lasted few years).

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    Quote Originally Posted by Maciamo View Post
    You are completely missing the point of this thread. I haven't talked anywhere about the quality of democracy, not socio-economic inequalities, happiness, or anything of the sort. The only point being discussed here is: When is a country wealthy enough to become a democracy? (and remain it for the foreseeable future, not like the democracy established during the French Revolution which only lasted few years).
    In my opinion democracy works on cycles, moving from democracy to autocracy. Wealth has no impact on the cycle, accumulation of wealth in few hands drives the system to autocracy. Let’s not forget that Greek Democracy came after a period of autocracy after Bronze Age collapse.


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    Quote Originally Posted by blevins13 View Post
    In my opinion democracy works on cycles, moving from democracy to autocracy. Wealth has no impact on the cycle, accumulation of wealth in few hands drives the system to autocracy. Let’s not forget that Greek Democracy came after a period of autocracy after Bronze Age collapse.
    Do you have any evidence to support that opinion?

    Since you mention ancient Greece, there was no such thing as Greek Democracy. There was only Athenian Democracy, and it was only a partial democracy by the modern definition as to qualify as a voter one had to be an adult male Athenian citizens who had completed their military training as ephebes. Athenians of foreign origin, even if they had been living there for numerous generations, were excluded. Furthermore Athenians practised slavery, which is against the fundamental understanding of democracy today. All in all that meant that only 30 percent of the total adult population was eligible. That was therefore a system intermediary between oligarchy and democracy, like that of the Roman Republic.

    Of the hundreds of Greek city-states and colonies ranging geographically from Spain to Ukraine, it is telling that (partial) democracy was only able to develop in Athens, the richest of all the Greek cities, and only during its golden age.

    Regarding the Roman Republic, it was originally an oligarchy in which the patrician class monopolised most of the political offices. As the republic grew wealthier, the plebeians started to demand equal rights, leading to the Conflict of the Orders. It ended with the promulgation of the lex Hortensia in 287 BCE, which conferred nearly equal rights to the plebeians and patricians. That was when Rome already controlled most of Central and South Italy.

    At least 7 academic studies have tried to estimate the GDP per capita in ancient Rome. It ranged from $500 to $1000 in 1990 Int$. That was the average for the empire, but the GDP per capita was 40 to 66% higher in Italy itself. Rome was of course the wealthiest, and it is reasonable to assume that Roman citizens in Rome were at least 2 or 3 times richer in average than in other Italian cities (once slaves, liberti and foreigners are excluded). That would bring their GDP per capita around $4,000.

    As I mention the topic of slavery, it would be more logical to consider that the United States only became a modern democracy when slavery was abolished (in 1865), or even when Black people obtained the right to vote (in 1870). In 1870 the GDP per capita of the USA was $3,736, very close to the $4,000 to 7,000 range of other democracies.

    As for Albania, it became a democracy in 1991 when the GDP per capita was $4,454. It also fits the model.

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    Quote Originally Posted by Maciamo View Post
    Do you have any evidence to support that opinion?

    Since you mention ancient Greece, there was no such thing as Greek Democracy. There was only Athenian Democracy, and it was only a partial democracy by the modern definition as to qualify as a voter one had to be an adult male Athenian citizens who had completed their military training as ephebes. Athenians of foreign origin, even if they had been living there for numerous generations, were excluded. Furthermore Athenians practised slavery, which is against the fundamental understanding of democracy today. All in all that meant that only 30 percent of the total adult population was eligible. That was therefore a system intermediary between oligarchy and democracy, like that of the Roman Republic.

    Of the hundreds of Greek city-states and colonies ranging geographically from Spain to Ukraine, it is telling that (partial) democracy was only able to develop in Athens, the richest of all the Greek cities, and only during its golden age.

    Regarding the Roman Republic, it was originally an oligarchy in which the patrician class monopolised most of the political offices. As the republic grew wealthier, the plebeians started to demand equal rights, leading to the Conflict of the Orders. It ended with the promulgation of the lex Hortensia in 287 BCE, which conferred nearly equal rights to the plebeians and patricians. That was when Rome already controlled most of Central and South Italy.

    At least 7 academic studies have tried to estimate the GDP per capita in ancient Rome. It ranged from $500 to $1000 in 1990 Int$. That was the average for the empire, but the GDP per capita was 40 to 66% higher in Italy itself. Rome was of course the wealthiest, and it is reasonable to assume that Roman citizens in Rome were at least 2 or 3 times richer in average than in other Italian cities (once slaves, liberti and foreigners are excluded). That would bring their GDP per capita around $4,000.

    As I mention the topic of slavery, it would be more logical to consider that the United States only became a modern democracy when slavery was abolished (in 1865), or even when Black people obtained the right to vote (in 1870). In 1870 the GDP per capita of the USA was $3,736, very close to the $4,000 to 7,000 range of other democracies.

    As for Albania, it became a democracy in 1991 when the GDP per capita was $4,454. It also fits the model.
    The cycle:
    "From bondage to spiritual faith;
    from spiritual faith to great courage;
    from courage to liberty;
    from liberty to abundance;
    from abundance to selfishness;
    from selfishness to apathy;
    from apathy to dependence;
    from dependency back again into bondage."

    I think there are authors that consider the cycles of democracy and autocracy.

    https://en.m.wikipedia.org/wiki/Kyklos

    https://en.m.wikipedia.org/wiki/Anacyclosis
    Last edited by Maciamo; 12-07-20 at 11:00.

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    Quote Originally Posted by blevins13 View Post
    The cycle:
    "From bondage to spiritual faith;
    from spiritual faith to great courage;
    from courage to liberty;
    from liberty to abundance;
    from abundance to selfishness;
    from selfishness to apathy;
    from apathy to dependence;
    from dependency back again into bondage."

    I think there are authors that consider the cycles of democracy and autocracy.
    Sounds nice, but how does this apply to democracy anywhere in the world? No modern democracy with a GDP per capita above $9000 has ever failed. The only ancient democracies, Athens and Rome, were not real democracies in the modern sense, and your cycle does not mention democracy at all anyway.

    It's very sad that I am trying to use a very modern approach to review what is essentially a modern phenomenon (democracy) and you seem be be stuck with the thinkers of 2500 years ago, as if nothing had changed and nothing ever would change.

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    How GDP per capita can influence the stability of a democracy

    Quote Originally Posted by Maciamo View Post
    Sounds nice, but how does this apply to democracy anywhere in the world? No modern democracy with a GDP per capita above $9000 has ever failed. The only ancient democracies, Athens and Rome, were not real democracies in the modern sense, and your cycle does not mention democracy at all anyway.

    It's very sad that I am trying to use a very modern approach to review what is essentially a modern phenomenon (democracy) and you seem be be stuck with the thinkers of 2500 years ago, as if nothing had changed and nothing ever would change.
    There is modern approach as well...on the sources that I have sent you using the old thinkers as basis.
    Current democratic cycles in US is approx. 190 years, in other countries less......I hope it continues. Time will show if theory is valid..... probably I will not going to be alive to observe it.



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    Last edited by blevins13; 12-07-20 at 15:11.

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