Abstract
ABSTRACT This paper distinguishes three types of countries (rich, middle-income, and pre-industrial) and focus on the latter, which, in contrast to the other two, didn’t complete their industrial and capitalist revolutions. Can pre-industrial countries be governed well and under democracy? Today democracy is a universal value, and, so, these countries are under pressure from the West and from its own society to be democratic, even though they do not dispose of mature enough societies in which the economic surplus is appropriated through the market. In fact, no country completed its industrial and capitalist revolution within the framework of even a minimal democracy. Additionally, pre-industrial countries are extremely difficult to govern because they usually don’t have a strong nation and capable states. This double pressure represents a major obstacle to their development.
Highlights
This paper distinguishes three types of countries and focus on the latter, which, in contrast to the other two, didn’t complete their industrial and capitalist revolutions
I will briefly review the paths to capitalism and democracy, and show that to have a consolidated democracy each country must, first, make its national and industrial revolution, what will happen in the framework of a developmental state
A capable state, which succeeds in industrializing or turning the country productively sophisticated, has always been a developmental state—a state that (a) is usually supported by a class coalition associating industrial entrepreneurs, urban workers and the public bureaucracy, (b) has as priority economic development, (c) is nationalist in economic terms insofar that capitalism is characterized by the competition among nation-states and the hegemony of the West, (d) and intervenes moderately but effectively in the economy to achieve national autonomy and growth, not in the competitive sector of the economy, where the market is a superior coordinative institution, but in the non-competitive sector
Summary
Countries may be categorized as rich or developing, the latter being either middle-income ones like Brazil, Argentina, China and India, which have already completed their industrial or capitalist revolution, or pre-industrial countries as Egypt, Bolivia, Bangladesh and Mozambique. In Latin America, where political independence was achieved in the early nineteenth century, economic and cultural dependence remained strong, given the type of mercantile and plantation colonization they had; this was very different to the colonization by settlement that happened in the Northeast of the United States.. Different was the behavior of East Asian countries, where cultural dependency was smaller These countries followed Japan’s example, made their industrial and capitalist revolution since the 1950s, and today are rich countries. Kraay and McKenzie (2014) conclude from this table that the “poverty trap” models were not validated, as the poorest quintile growth was above average They are right because in a pre-industrial country the first stage of development takes place when it is able to profit its natural resources to export some commodity. Once this obstacle is surmounted, growth rates increase and turn near the average: there is not catching up, but growth became relatively self-sustained
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