Is democracy more expropriative than dictatorship? Tocquevillian wisdom revisited

Research output: Contribution to journalArticle

11 Citations (Scopus)

Abstract

We reexamine the incentive effect of political democracy on the tax rate by defining a political regime over two dimensions: The extent of the franchise and the extent that the redistribution of tax revenues is biased towards the rich. Standard Tocquevillian models assume that, even if there is limited franchise, there is no redistribution bias; from this, it follows that democracy is more expropriative than oligarchy because a poorer median voter opts for higher taxes. Introducing the realistic assumption of a redistribution bias, we find a countervailing effect: Democratization decreases exploitation by the rich on the disenfranchised poor; since tax revenues are redistributed over a larger base, the median voter may gain less from redistributive taxation (we call this the Olson effect).

Original languageEnglish
Pages (from-to)155-198
Number of pages44
JournalJournal of Development Economics
Volume71
Issue number1
DOIs
Publication statusPublished - 2003 Jun 1
Externally publishedYes

Fingerprint

dictatorship
redistribution
democracy
wisdom
tax revenue
voter
oligarchy
political regime
trend
taxation
taxes
democratization
exploitation
incentive
tax
Wisdom
Dictatorship
Redistribution
Democracy
effect

Keywords

  • de Tocqueville effect
  • Democratization
  • Elitist regime
  • Olson effect
  • Paternalistic regime
  • Political economy
  • Redistribution bias

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

Is democracy more expropriative than dictatorship? Tocquevillian wisdom revisited. / Lee, Woojin.

In: Journal of Development Economics, Vol. 71, No. 1, 01.06.2003, p. 155-198.

Research output: Contribution to journalArticle

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