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8 Cards in this Set
- Front
- Back
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Property Rights story |
-Democracy places limits on the ability of governments to engage in the arbitrary seizure of private property so this encourages investment and in turn growth -This is a weak theory because there's no evidence linking democracy to the rule of law |
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Meltzer-Richard Model |
-Above average income contributes want low taxes beacause they don't benefit that much
-Below average income contributes want high taxes because they benefit more |
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How democracy effects taxes |
-A democratic transition will lead to higher taxes and a redistribution of wealth from rich to poor
- So the rich are less likely to invest and the economy will slow |
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Criticisms of Meltzer's Model |
-Poor ppl are less likely to vote so tax rate in democracy may not be that much higher than a dictatorship -structural dependence of the state on capital (capitalists have a veto over state policies) |
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Consumption vs Investment story |
-Workers encourage governments to describe assets towards consumption and away from investment - If dictators are future oriented they can force ppl to save |
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Dictatorial Autonomy |
-Dictators don't have pressure from interest groups -Money doesn't need to be spent in an inefficient way -Dictator could also act more predatory |
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Evidence |
It is not known if democracy help or hinders economic growth |
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Regime type effect on government performance |
-Democracy is only sufficent for success |
