Arnold Kling

Autocracy and Economic Outcomes

Arnold Kling, Great Questions of Economics
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Bruce Bueno de Mesquita and Hilton L. Root argue that autocratic governments have incentives to follow economic policies that are not in the interest of the average citizen. Leaders whose power base is inclusive of wide groups of the population remain in power longer if they promote economic growth. However, the opposite is true for leaders who have a narrow power base.

[Autocrats] who rely on black-market corruption have a better chance of staying in power than those who engender high rates of growth, staying in office, on average, 25 percent longer. Indeed, at all periods during their tenure in office, these leaders do much better at retaining their jobs if they promote black marketeering, corruption and cronyism--distorting the economy--than if they promote economic policies that lead to growth and prosperity.

Discussion Question. What does this analysis suggest about the economic consequences of giving aid to autocratic regimes?

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