Democratization and the conditional dynamics of income distribution

Michael T. Dorsch, Paul Maarek

Research output: Contribution to journalArticlepeer-review

Abstract (may include machine translation)

Despite strong theoretical reasons to expect that democratization equalizes income distributions, existing empirical studies do not find a statistically significant effect of democratization on measures of income inequality. This paper starts from the simple observation that autocracies are heterogeneous and govern quite extreme distributional outcomes (also egalitarian). Democratization may drive extreme income distributions to a middle ground. We thus examine the extent to which initial inequality levels determine the path of distributional dynamics following democratization. Using fixed-effects and instrumental variable regressions, we demonstrate that egalitarian autocracies become more unequal following democratization, whereas democratization has an equalizing effect in highly unequal autocracies. The effect appears to be driven by changes in gross (market) inequality, suggesting that democratization has led, on average, to redistribution of market opportunities, rather than to direct fiscal redistribution. We then investigate which kinds of (heterogeneous) reforms are at work following democratizations that may rationalize our findings.

Original languageEnglish
Pages (from-to)385-404
Number of pages20
JournalAmerican Political Science Review
Volume113
Issue number2
DOIs
StatePublished - 1 May 2019

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