Echoes of Barrington Moore

Michael Munger writes:

Daron Acemoglu and James A. Robinson, Economic Origins of Dictatorship and Democracy. New York: Cambridge University Press, 2005. xv + 416 pp. $35 (cloth), ISBN: 0-521-85526-6.

The key questions posed in this book have to do with the origins and stability of institutions. Specifically, why do some nations introduce democratic institutions and others fail.... The book rests on a seeming paradox: politically powerful groups need some device that will allow them credibly to commit to reducing their own power. The threat of mass revolution cannot be forestalled by the promise of side payments, unless the means by which those side payments are decided and awarded is literally within the power of the masses....

[C]oups against democracies that impose an oligarchy have much the same logic as coups against oligarchies that seek to impose democracy. In both cases, at least with full information, the current regime will nearly always be better off offering concessions and side payments. But the coup may occur anyway, if the existing regime, regardless of its type, fails to devise a credible means of guaranteeing the compensation once the coup threat dissipates. This is a particular problem when the leaders of a potential coup recognize that their ability to make threats is transitory....

[D]emocracies have historically been created by elites when the threat of social unrest and violence cannot be defused in any other way. This condition will only be met when the conditions in which citizens live are so bad, but the set of civic connections and infrastructure for overcoming the collective action problems inherent in organizing revolution are so good, that revolution is imminent. Second, democracies will not be an answer to the threat of revolution, even credibly imminent revolution, when inequality is so high, and/or when the assets of elites are easily nationalized or taxed away, or when elites expect to lose control of the ability to write down basic constitutional rules that constrain the scope of democratic government action.

More simply, then, we expect elites to support democratic transitions when the threat of failing to do so is nearly certain revolution, and when the expected political and economic costs of democracy can be kept within certain bounds....

I expect that the book will be one of the influential pieces of scholarship of the past decade. Its virtue is its flaw: it develops a coherent framework that takes a particular perspective (instantiating the claims of threat and cost outlined above in a model), and derives propositions from those models....

There is one kind of problem the book does not handle very well.... Acemoglu and Robinson are entirely too confident of the ability of political institutions to control the specter of political, and ultimately revolutionary, chaos.... My quibble about social choice stability aside, I would recommend this book to anyone with a serious interest in democratic transitions and economic development. Its historical scope, and the power of the models it develops, set a new standard in political economy.