Disentangling the Complex Relationship between Democracy and Development: Part I - Economic Research Forum (ERF)

Disentangling the Complex Relationship between Democracy and Development: Part I

This blog post is written by Ahmed Goher (Economic Research Forum)

Economic Research Forum (ERF) held the first plenary session of its 21st Annual Conference on March 20 in Gammarth, Tunisia. The session came to answer a number of questions of vital importance to the transition processes a number of MENA countries embarked on following the Arab Spring. Namely, what is the nature of the causal relationship between democracy and development? Does democracy lead to more growth and development in countries? Conversely, does development lead to democracy? And, perhaps more importantly, what does all of this mean for MENA countries in transition.

To explore this complex but integral theme, ERF joined speakers Ibrahim Elbadawi, director of research at the Dubai EHB__8546conomic Council, and Adam Przeworski, Carroll and Milton Professor of Politics and (by courtesy) Economics at New York University, together in the first plenary session of the 21st Annual Conference.

Following the two cross-cutting themes of resource-dependency and social polarization, Elbadawi, who largely focuses on oil-rich Arab economies, began the session by giving a presentation titled ‘The Arab Spring: Much Violence, Little Democracy,’ in which he tackled three broad questions: (1) Is democracy important for development? (2) If so, why has the Arab Spring been such a “late awakening”? and (3) Why is there so much violence? .

Elbadawi’s answer to the first question concludes that the Asian development model is not transferable to the Arab world because of dependence on natural resources and fractionalization in the Arab World. Elbadawi argues that Arab countries, especially oil-rich populous ones, for the large part suffer from low commitment to checks and balances and low levels of inclusiveness, leading to their experiencing of the oil curse phenomenon. Moreover, many Arab countries are fractionalized on the basis of language, ethnicity and religion. This means that authoritarianism is not sustainable in the Arab World, since for one thing democracy is the best path for highly fractionalized societies to function. Accordingly, Elbadawi draws three lessons for transitioning MENA countries: (1) “…For every Lee Kuan Yew of Singapore, there are many like Mobutu Sese Seko of the Congo” (Dani Rodrik, 2010); (2) the Arab Spring should not only bring about democracy, as badly needed as it is for this region, but should also lay the foundations for strong systems of political checks and balances; and (3) programmatic benevolent authoritarianism has been, and will likely continue to be, an exception to the rule in the socially fractionalized Arab World; indicating that democracy is key to the survival of the nation state in this region, while factional, winner take all, democracy is not a solution. He also argued that democracies invest more in human capital than autocracies.

Moving on to answer the second question of why the Arab Spring was so late to happen, Elbadawi identifies a number of factors. For one thing, controlling for initial income, growth and democratic legacy, natural resource dependency impedes democratic transitions (while noting that below a certain threshold, resource rents have no impact). Secondly, wars, a widespread MENA phenomenon, also hinder democratic transitions. Moreover, countries surrounded by democratic neighbors are more likely to be democratic. Finally, neighborhood wars (such as the Arab-Israeli conflict) impede democratic transitions .

Coming to the question of why the transition process was so violent in the region, Elbadawi notes the “induced violence” phenomenon. According to Elbadawi, since the year 2000, autocrats have been ousted by popular uprisings more than they have by coups. Accordingly, authoritarian regimes have taken note of this and learned to respond to popular uprisings by counter-revolutions through induced violence. This is especially clear during and after the Arab Spring, with over 300,000 casualties in the Syrian Civil War alone. Furthermore, while early modernization and institutional theories are useful; they do not account for the role of resource dependency and social characteristics in the adoption of strategies of violence. Although highly-endowed countries usually opt to “bribe” their citizenry to pre-empt uprisings; their low and moderately endowed counterparts usually adopt a strategy of violence to pre-empt revolts. Moreover, when it comes to social characteristics, Elbadawi finds that an autocrats’ belonging to an ethnic minority/majority determines the chosen strategy to suppress revolts. For instance, an autocrat belonging to the majority in a resource-endowed state will choose to spend heavily on all citizens to avoid revolts; an autocrat belonging to the majority, with little resources, will peacefully extend franchise, like in Egypt and Tunisia; while a dictator from a minority group will use violence and will spend only on the minority because it is cheaper. This third possibility can be attributed to ruling minorities not having enough assurances about the potential outcomes of democratic transitions, which they could perceive as being potentially disastrous.