Economic Growth Differences: Democratic vs. Non-Democratic Countries

Democratic countries have higher economic growth than non-democratic countries. The following chart shows the difference in GDP growth per capita between Singapore and Jordan:

click to enlarge

Source: Democracy, diversification, and growth reversals by David Cuberes , Michal Jerzmanowski

The above chart shows the exponential growth enjoyed by the citizens of Singapore over the past few decades compared to Jordan which has stagnant growth. This is because Singapore is a democracy while Jordan is not. Jordan is a a constitutional monarchy with a representative government. Executive authority lies with the King King Abdullah II and his council of ministers.

Some of the reasons for the difference in economic growth between Jordan and Singapore are:

• Openness to trade
• Protection of property rights
• High investment rates, etc.

Singapore has the above factors in abundance while Jordan lacks.

To read more , go here.

Comments

[Dave Wrixon:]

Poorly researched article. Why choose these two anyway? Singapore is hardly the bastion of democracy and its success probably has more to do with its relationship with China than anything else. Poor Old Jordan has real difficulties being pretty much landlocked between Israel which has a secure border and Iraq whose economy has collapsed due to Civil War. Come on give us a break and come up with something a bit more substantial than this. How about comparing China with the US for example?

Aug 16 07:14 AM

[BRUCE E. W.:]

Apples and Elephants!

Aug 16 11:52 AM

[Beagle:]

Your column earlier this month about job growth and immigration was excellent, but this one falls far short. There are many factors that affect economic growth. You can't attribute the difference between two countries' growth wholly to one differing characteristic, without proof.

This might just be a case where you've only summarized the conclusion of a full study, but not the authors' work in reaching the conclusion(?).

Aug 16 12:05 PM

[hondaicivic:]

"This is because Singapore is a democracy while Jordan is not".....

^You do know that Singapore is a one-party state right? The PAP is the ruler of singapore since its independence. The political system in Singapore is similar to China, only more efficient. By the way, have you been to Singapore?....

Aug 16 01:25 PM

[Uppai Mappla:]

Alas, it was an excellent research topic. But all is not lost. The author could consider doing a comparative study of two sets of, say, 5-6 countries each, which had started out with similar history, natural resources, population mix etc., but ended up with opposite types of government.

I can't think of any yet. My first thought was about about Israel and Jordan. But no, Israel's population mix is drastically different from that of Jordan with its very educated and motivated immigrant population, and in addition the country was generously supported with money, arms and business opportunities from the West.

Could we brainstorm this? Can anyone think of such sets of countries? We could have a fruitful debate I guess!

Aug 21 08:15 AM

[Universal H...:]

Debate? Please, why bother?

My 11-year old could tell you about the result of USA vs. USSR... My 15-year old, however, would argue that it's not the form of government or even the government itself that determines a nation's prosperity, but rather the economic system, and that capitalism has produced more wealth for more people in a shorter amount of time than any other economic system in history. On the other hand, my 18-year old would argue that it's neither government nor capitalism which creates wealth, but rather it is the power of individuals existing in a culture where they are granted rights, exercise freedoms and maintain responsibilities to each other.

Anyway, didn't some really smart people already figure this out some 230 years ago?

Aug 22 08:40 PM

[Nathaniel C:]

How did this article get published by SA?

Aug 23 08:59 PM