The Electoral Authoritarian Advantage in Access to Credit

• In Event: Historical Political Economy

Abstract

Authoritarian rulers in medieval and early modern Europe who struggled to meet their budgetary demands created representative institutions to broaden their support coalitions and stabilize their regimes. I argue that modern dictators introduce elections for similar reasons. Dictators who face financial difficulties are more likely to introduce multiparty elections to placate their domestic oppositions without relinquishing office. In both historical and modern regimes, representative institutions limited executive authority which increased their access to credit. I test the implications of this argument with data from 88 dictatorships between 1970-2014. I find dictators are more likely to transition to electoral authoritarianism after financial instability as measured by debt crises, rising interest rates on new debt, and IMF loans. I also find that dictators who introduce elections benefit in the long term from lower interest rates on new debt. The results suggest that the logic and substantive basis for authoritarian rulers to create representative institutions are general to both early parliamentary regimes and modern electoral authoritarian dictatorships.

Author

• Austin Michael Mitchell, Tohoku University