When we look at systematic historical evidence, instead of individual cases, we find that authoritarianism buys little in terms of economic growth. For every authoritarian country that has managed to grow rapidly, there are several that have floundered. For every Lee Kuan Yew of Singapore, there are many like Mobutu Sese Seko of the Congo.
Democracies not only out-perform dictatorships when it comes to long-term economic growth, but also outdo them in several other important respects. They provide much greater economic stability, measured by the ups and downs of the business cycle. They are better at adjusting to external economic shocks (such as terms-of-trade declines or sudden stops in capital inflows). They generate more investment in human capital – health and education. And they produce more equitable societies.
Authoritarian regimes, by contrast, ultimately produce economies that are as fragile as their political systems. Their economic potency, when it exists, rests on the strength of individual leaders, or on favorable but temporary circumstances. They cannot aspire to continued economic innovation or to global economic leadership.
That is Dani Rodrik in Project Syndicate.
Economies must not only weather shocks and business cycles; if successful, they must weather growth as well. Each implies shifts in economic power, and it’s these shifts in power that authoritarian regimes seem handle so poorly and democracies… less poorly.
If I had to speculate, I’d guess the stronger, more flexible authoritarian regimes are ones that are rooted in parties rather than personalities, and in places that start with a large professional class available to become technocrats–spreading power and decision-making among more bodies.
Ultimately, it’s hard for me to see how an authoritarian nation (other than a small enclave like Singapore) can handle the rapid growth of wealth in both a industrial middle class and an industrial elite. It’s not the new, authoritarian political equilibrium that seems unstable, it’s the transition between the new and the old that seems fraught with peril.