Political Leaders, Education, and Regional Inequality

• In Event: Are Political Leaders Out of Touch with the Poor?

Abstract

Regional economic inequality plays an important role in the salience of populism and the decay of democratic trust. Across the world, economic discrepancies between favored and non-favored regions are a major source of political turmoil, including Brexit voting, Americans' support for Donald Trump, and the Catalan independence referendum of 2017. Even though previous studies have explored why some countries have achieved egalitarian regional economic development, few studies provide a political explanation for why regional inequality varies within and across countries. Additionally, most studies are limited to a small subset of industrialized or middle-income countries. The coverage of regional inequality data in most studies are restricted within those countries. We overcome this limitation by exploring an original dataset of regional inequality using night-satellite image data, which covers all countries around the world, including both developed and developing countries.

We argue that political leaders' educational background significantly affects why certain countries do not promote balanced regional development. We posit that educational achievement of more educated leaders induces them to hold pro-meritocratic attitudes because these leaders tend to believe competition, competency and effort lead to their own success. Thus, these leaders prioritize economic development of advanced regions over balancing regional economic development. We find support for our argument by analyzing an original dataset of leaders' background and satellite image-based regional inequality data in 132 countries between 1992 and 2013.Our study shows that leader's educational background is a more critical determinant of regional inequality than previously accepted determinants. Additionally, we find that the effect of leaders' educational background is stronger in authoritarian regimes than in democracies. In democracies, strong institutional constraints and more developed mechanisms to limit political leaders’ powers weakens the relationship between educational background and regional inequality in democracies. Our finding is robust to different model specifications and consideration of endogeneity issues.

Our study makes several contributions to the existing literature on inequality and distributive politics. First, this study provides a political explanation of how the backgrounds of top executives affect regional economic distribution. Additionally, consistent with previous studies, this study shows that political leaders play more important roles in deciding distributive policy in countries with less institutional constraint, implying that variation in regional inequality can be attributed to different factors among democracies and non-democracies.

Authors

• Kangwook Han, Michigan State University

• Sung Min Han, Shanghai University of Finance and Economics

• Alexander Mardon