Oligarchy, democracy, inequality and growth


Bourguignon, François and Verdier, Thierry (2000) Oligarchy, democracy, inequality and growth. Journal of Development Economics, 62, (2), 285-313. (doi:10.1016/S0304-3878(00)00086-9).

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Description/Abstract

This paper analyses the dynamics of inequality, democratization and economic development in a political economy model of growth where education is both the engine of growth and a determinant of political participation. In a context with imperfect capital markets, we investigate the incentives for an educated oligarchy to subsidize the poor's education and to initiate a democratic transition. We characterize the equilibrium patterns of political institutions, income distribution and growth as a function of the initial income and inequalities. In particular, we identify circumstances under which the Elite promotes the endogenous emergence of a middle class for purely political economy reasons. A simple linear infinite horizon framework is then presented. In this setting, we discuss the importance of historical dependence for long-run social stratification and redistribution

Item Type: Article
Additional Information: JEL classification codes: O11, O15, D72
ISSNs: 0304-3878 (print)
Related URLs:
Keywords: inequality, economic development, political economy, redistribution, democratization
Subjects: J Political Science > JA Political science (General)
H Social Sciences > HB Economic Theory
Divisions: University Structure - Pre August 2011 > School of Social Sciences > Economics
ePrint ID: 33483
Date Deposited: 20 Jul 2006
Last Modified: 27 Mar 2014 18:20
URI: http://eprints.soton.ac.uk/id/eprint/33483

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