Democracy, Dictatorship and Development

This book endeavours to explain the consequences for economic development of various forms of regime in the Third World.¹ It seeks to discover the ways in which democratic and authoritarian regimes respectively are contributing (or not contributing) to economic development in Third World countries. Focus is on the experience of four Third World countries from around 1950 to the early 1980s. The present chapter examines the theoretical debate and formulates hypotheses and questions for the four country case-studies which follow. The theoretical implications of these analyses are explored in the final chapter.

British rule both hindered and helped the expansion of industry in India. The British brought a certain measure of law and order, the construction of railways provided a basis for economic integration of the subcontinent, and import-export activity also provided opportunities for Indian merchants in areas which the British found uninteresting (Kemp 1983:75; Martinussen 1980: 180–99). On the other hand, the East India Company banned export of industrial machinery from England to India before 1857; more importantly perhaps, railroad construction relied completely on inputs manufactured in England, and it was not until the last few years of the nineteenth century that the government of India was allowed to purchase iron and steel goods produced in India (Thorner 1955, cited in Martinussen 1980:182). Moreover, potential producers in India were held in check by the stiff competition from the fast-growing, technologically advanced British manufacturers.

The Chinese empire has a place in the history of mankind as one of the most stable and long-lasting civilisations. It had the potential of experiencing an industrial revolution several centuries before it occurred in the West. Yet such possibilities were never exploited. The history of the empire from the fourteenth century to its final collapse in 1911 is one of slow change in a context of social and technological stability (Riskin 1987:11n.). The social structure of imperial society is the most important factor in explaining this combination of stability and lack of developmental dynamics:

The intelligentsia, members of the state bureaucracy and land-owners formed a close-knit social class known as the gentry, which exercised a strong hegemony over all important levels of economic, political and social power ... They controlled land, wealth, political power and officially defined knowledge. They also controlled social status through the reproduction of Confucian culture (which exalted them over the peasantry), control over kinship organisations (which bound peasants of the same lineage to them, in a subordinate position, of course), and manipulation of a myriad of local cultural symbols. Their domination over the peasantry was total (Blecher 1986:6,8).

Taiwan (the Republic of China) was incorporated in the Chinese empire by the mid-seventeenth century. Before then it had been controlled by the Dutch as one of many stations in Holland’s global network of trade. Sugar and deerskin from the island, produced by the Malayo-Polynesian aborigines or by mainland Chinese brought in by the Dutch, were exported and goods were trans-shipped between China, Japan, and Europe (Gold 1986:23n.).

The hypotheses and questions put forward in Chapter 1 have now been examined through four case-studies. Reality has proved somewhat more complex than indicated in the original hypotheses. The present chapter attempts to draw the results together and formulate some new, hopefully more nuanced conclusions about the circumstances under which a specific form of regime has certain consequences for economic development. Focus is first on the democratic cases, then on the authoritarian ones; after that, some comparisons between the two forms are made, and the implications for other countries, democratic and authoritarian, are addressed