THE RELATIONSHIP BETWEEN DEMOCRACY AND DEVELOPMENT

Mahatma Gandhi once stated, “what difference does it make to the dead, the orphans, and the homeless, whether the mad destruction is wrought under the name of totalitarianism or the holy name of liberty or democracy”. For him, the type of government does not matter but how the government serves the well-being of the citizens is very crucial. The relationship between democracy and development always leaves scholars, academicians and politicians perplexed due to its complex linkages. Democracy and development always make us puzzle of which should come first. Is democracy first, development second, or vice versa? Does democracy is the only answer for development or does it not?

Democracy in its simplest form is an institutional arrangement for arriving at political decisions in which individuals acquire the power to decide by means of a competitive struggle for the people’s vote’ (Schumpeter: 1942). However, I argue that the meaning of democracy is beyond contestation and election process. Thus, a much more comprehensive definition is whereby the whole of society can participate, at every level, in the decision-making process and keep control of it (Universal Declaration of Human Rights and the Vienna Pacts and Declaration of 1993).

Relying on economic indicators is no longer a comprehensive measurement in determining a development success because a sustainable environment, level of democracy, literacy rates, and rule of law are also closely related to development. In determining the link between democracy and development for this article, I would like to define development as a progression or transformation of a state from bad or worse to betterment especially in economic growth.

Democracy alone could not lead to development since it must be supported by key institutional features of the democratic system.  By looking at the definition of democracy in its minimalist meaning, an election is a process and not an outcome, thus, to expect a mere transition to formal democracy, does not guarantee a development progression. Democracy and democratic values have a significant role to play in development processes (Sen : 1999). A democratic consolidation of a democratic system for example equality, political tolerance, accountability, check and balance provision of the power of the executive, separation of power, greater participation in decision-making, and the independent judicial system needs a continuous and concerted effort by all to eventually lead to development progression. Democracy indeed has a positive impact on economic and social development, though mostly through indirectly for example political stability, policy certainty and assurance and protection of property rights (Yi Feng : 2003). This is because the regular election process and change in government make it feasible to uphold these indirect benefits which eventually accelerate economic growth. Moreover, political freedom fosters economic freedoms such as secure property rights and certainty of contract, which, in turn, underpin higher rates of economic growth (Friedman : 1962). However, an immediate and better socio-economic outcome could not be forecasted just because the democratic states are being democratic. For example, some countries face with incomplete democratization process due to their low human development and state capacity building. Thus, a capable, credible, effective state with better delivery service and governance, and less corruption should be established while promoting key features of democracy in the state. Further, an election process does not lead to democracy. Indeed, democracy at its core, is a state of mind, a set of attitudinal dispositions woven into the fabric of a society, the concrete expression of which are its social institutions (Fayemi : 2005).

The drawback of democracy could be seen when taking into consideration all related parties in decision-making, it creates delays and increases bureaucracy in the government. Procrastination of policy recommendations and programmes will hinder development progression in a country. Thus, although embracing the features of the democratic system, it still could hinder the development in progress. Even in a democracy, there will be those whose aim is to challenge the private property status quo if it is in their best interests, and because of the very nature of democracy they will have more opportunities to do so (Przewoki and Limongi, 1993). Some might argue that the indirect benefits of democracy for example stability in the political environment, poverty reduction or eradication are not exclusively related to democracy since other regimes like authoritarian also could enjoy such benefits.

Democracy is not necessarily the only pre-requisite for development, perhaps a hybrid of both democracy and authoritarianism leads to development progression. In certain cases and situations, democratic establishment in developing countries may hinder economic growth because the poor who are the masses have greater voice and participation in policy-making. For example, with a tendency to organize and gather people, the poor in democratic states tend to consume immediately rather than save for future investment. Less and lower savings means lower investment thus could cripple the economic growth in a developed state. Less state autonomy due to separation of power also could contribute to economic growth hindrance compared to authoritarianism which possesses more autonomy and can gather coherence and agreement between the citizens.

Since it is the function of the states to accelerate economic growth, democracy might not be a pre-condition in development. A highly autonomous and centralized government under an authoritarian regime would be a better practice to promote development due to its expediency in the decision-making process. In an authoritarian regime, usually one-party dominance in the government makes it much more stable where state actors are supposed to enjoy much longer time horizons since they do not need to worry about the short-term politicking that arises from electoral cycles (Halperin et al. : 2005) compared to the democracy. This major advantage in implementing programmes and policy recommendations for a much longer period would help the authoritarian regime in implementing more comprehensive plan, policies and programmes for development with less objection from the masses, rather than changing the policy and programs every time once the new government emerged as in the democratic state. To illustrate, the East Asian Tigers proved that democracy is not necessary in accelerating economic growth and transforming the socio-economics because the institutional capacity and autonomy to promote developmental goals is much salient. Or perhaps, a hybrid of both democracy and authoritarianism would help a state in developing its economic growth and social aspects. Regime type has no significant influence on states’ economic growth and national income and it is still an open question whether democracy hinders or fosters development (Przeworski et. All : 2000). Democracy has either a non-significant or moderately weak negative effect on growth once other growth-determining variables are held constant (Barro : 1996).

However, democracy seems to provide much more conducive environment in economic freedom promotion compared to authoritarianism because economic rights play a significant role in the political legitimacy and perpetuity of a democracy. The supporters of democracy as a pre-condition of development suggest that the protection of property rights is crucial and democracy with its features like accountability, reward and punishment system, forces the government to commit to their promises, being rewarded for desired intervention and punishment for undesirable outcomes (North and Weingast : 1989). Corruption is considered to be less likely or rarely occur in a democratic environment because democratic institutions limit the potential of public officials for personal wealth accumulation. Furthermore, in an authoritarian regime, no mechanism could hold the government accountable and responsible for their empty promises and commitments compared to a democracy.

Democracy sometimes does not lead to development, but the other way around. Rapid development leads to democracy and helps in sustaining democracy. Rapid development in a country enables a democratic regime to establish where democracy was more likely to emerge in countries with higher levels of socio-economic development and it is a pre-condition for democracy (Lipset : 1959, p.62). In modernization theory, democratization is imminent as a result of more structured and systematic government and greater participation of the masses in politics. The ideal social and cultural conditions for the foundation of democracy are born of significant modernization and economic development that result in mass political participation (Ronald Inglehart & Christian Welzel :2009). One might argue that higher income which is an economic indicator in assessing a country`s development may not be a pre-condition for democratization processes to start, but it is undeniable that it helps democracy to endure and become consolidated (Lipset : 1994) and for the sustainability of democracy (Przeworski & Limongi : 1997). We could take a look at modernization theory which explains the modernization process, and progressive transition within a society where much wealthier income and development acceleration such as industrialization and urbanization is correlated with democracy. The establishment of development in modernization theory creates equal opportunities for wealth, education and less nepotism and corruption, yet, strengthening the democracy in the state as a whole.

Some might argue that development does not contribute to democracy because democratization has multiple factors. The positive impact of initial income and primary education on democracy in cross-country analyses (Barro, 1999) disappears when country-fixed effects for example historical factors are controlled for (Acemoglu et al. : 2008). Democracy also could not be assumed as the outcome of modernization and development progression because hybrid regimes could also create long survival of government and stability that might be exclusive to a particular country. For example, the existence of an Islamic state where Islamic countries are developing their models of modernity, ones that value the role of reason and are pluralist, but also religious (Tamar Sonn : 1996). Although it remains ambiguous whether development has any ability to bring about democracy, it does seem clear that higher levels of wealth help to sustain existing democracies.

The linkages between democracy and development are complex and do not have any one solution answer. Democratic states have different significance degrees in designing the framework of their democratic features and consolidation. Democracy varies across the continent and depends much on the social change, political environment, demographics, traditions and colonization history that is distinctive to that particular country. Both democracy and development might have some reciprocal effects either directly or indirectly as according to Hirschman, democracy is not sufficient for the economy to grow, but as politic develops toward a full-fledged democracy, it will be more and more difficult for the economy to shrink or reverse to an earlier stage. While economic development is not sufficient to bring about democracy, as the economy develops to higher stages, it will become more and more effective in preventing democracy from perishing.  (Hirschman : 1994, p.344).

The article expressed here was part of the writer's essay submission at LSE.