Inequality, Collective Action, and Democratization

Abstract

Epic redistributive struggles between the rich and poor lie at the heart of prominent theories of economic development and the emergence of democracy (e.g., Boix 2003; Acemoglu and Robinson 2006). The poor pursue democracy to secure credible redistribution away from wealthy elites; elites, fearing redistribution, but also the costs of revolution, decide whether to repress these efforts or to surrender to them. These theories, and the historical examples of working classes exacting redistributive or political concessions from elites, have been interpreted as suggesting that inequality and redistributive struggles should be central features of development and democratization. Where inequality is high, democracy should be unlikely to emerge, or to emerge and be unstable. Because elites in unequal societies are unwilling to adopt institutions that encourage growth and investment (such as institutions that protect non-elites from predation by elites), incomes should be lower as well.