Intro to Political Science

Assignment
Submitted by : Asra Malik
Submitted to : Sir Shoaib
Roll no: 21003188012
Title : Democracy and Economic Growth

What is Democracy?
In a democracy, the system of government is decided by all. People elect their leaders
through voting and debate. Specifics that are significant consist of:
Citizenship: Everybody actively participates in the decision-making process.
Equality: Everybody is entitled to the same opportunities and rights.
Rule of Law: To ensure fairness, transparent laws are applicable to everybody.
Civil liberties: Freedom of speech, freedom of assembly, and the press are all guaranteed.

What Economic Development Involves?

Economic development is the process by which a country improves its wealth and the
standard of living of its citizens. Indicators include:
GDP Growth: Calculates the economic growth of the nation.
Higher Living Standards: Better Access to Needs, Healthcare, and Education.
Infrastructure: Improved communication, utilities, and roadways.
Jobs: Greater and higher quality employment prospects.

Democracy and Economic

Development:
Introduction :
Democracy and economic growth are closely intertwined, with democracy valuing citizens'
voices and allowing them to influence decisions through voting and discussion. Economic
growth refers to the expansion of a country's resources, wealth, and living standards.
Democratic societies provide more opportunities for citizens to participate in the economy,
leading to more supportive decisions. However, the relationship between democracy and
economic growth is not always clear, with some studies suggesting a positive relationship
and others indicating a lack of a direct link. Effective strategies for promoting democracy and
economic development must consider the complex nature of democratic systems.

Understanding the Relationship Between

Economic Growth and Democracy:
To promote stability and make better decisions, it is essential to understand the relationship
between democracy and economic growth. It supports policymakers in creating more
thoughtful strategies that support economic growth and democracy. It keeps our society
more stable and peaceful when we understand how democratic systems affect economic
results. International relations between nations are also impacted by this understanding.
Governments can concentrate their resources more effectively and support national
development while upholding democratic norms if they are aware of how various forms of
governance affect economic advancement. It serves as our nation's economic growth
strategy while maintaining democratic principles, much like a long-term planning roadmap.
This understanding also guides us in developing more equitable policies that benefit
everyone, ensuring that economic growth does not leave anyone behind. Ultimately,
realizing this connection benefits more than just our nation; it also contributes to international
efforts to protect democratic values while promoting growth in other countries.

A number of theories explain the connection

between democracy and economic development:
1. Theory of Modernization:
According to this theory, when countries modernize, they naturally move toward democracy
due to factors such as education, economic expansion, and technical advancement.
Connection to Economic Development:
It asserts that as economies grow and populations become more educated, the desire for
democratic governance grows.

2. The Theory of Institutions:

This theory emphasizes the value of establishments such as laws, rules, and governing
bodies. In order to develop democratic systems and promote economic progress, it is argued
that strong and open institutions are essential.

Relation to Economic Development:

Strong institutions promote an atmosphere that is favorable to both democratic stability and
economic growth.

3. Theory of Dependency:
Justification According to this argument, the global economic system promotes dependency
in less developed countries, limiting their democratic progress. It highlights how a nation's
capacity to attain both economic growth and democracy can be threatened by unequal
economic ties.
Relation to Economic Development: It emphasizes how a nation's capacity to advance
politically and economically is impacted by external forces and uneven economic
relationships.

4. Political Culture Theory:

Highlights how cultural values, attitudes, and beliefs influence a society's political structure.
It suggests that specific cultural values may help or prevent the development and
maintenance of democratic institutions.

Relation to Economic Development: The creation of democratic principles and the

development of an economy are both impacted by political culture's influence over
governance processes and economic policies.
Examples from History: Democracy and
Correlation with Economic Development
Post-World War II Europe:
Following World War II, democracies such as West Germany and Japan emerged during
the reconstruction phase. These countries achieved significant economic growth while
establishing democratic systems, demonstrating a link between economic recovery and the
emergence of democratic governance.

South Korea:
Under authoritarian government, the country's economy expanded significantly in the 1960s
and 1970s. The late 1980s saw the transition to democracy, demonstrating a connection
between economic success and the desire for democracy. However, as the economy
continued to grow, there was the a growing push for democratic reforms.

Examples of Economic Development Leading to

Democratization :
Under authoritarian government, Taiwan's economy grew in the 1970s and 1980s, giving
rise to a growing middle class that called for political changes. This economic prosperity
eventually opened the stage for democratization in the late 1980s.
In the 1970s, economic liberalization came before political democratization. Chile
progressively moved toward a democratic administration in the late 1980s following a period
of economic reforms.Democracy has a significant impact on important economic
aspects in a variety of countries, including South Korea, Estonia, Brazil, India, and
South Korea. Significant GDP growth has been driven by India's 1990s reforms,
which were supported by more foreign investment and improved infrastructure.
During its democratic transition in the 1980s, Brazil sought to reduce income
inequality by implementing targeted initiatives aimed at reducing poverty. Economic
growth was spurred by significant foreign investments following South Korea's
democratic transition. During democratic rule, Estonia, a former Soviet Union
country, placed a high priority on technology and education, encouraging creativity
and technological breakthroughs. These instances highlight how democracy affects
GDP, income equality, investment, and technical advances across diverse country
conditions.

Relationships between Economic Growth and

Democratic Institutions:
Economic growth and democratic institutions are positively correlated, according to
numerous empirical research. Statistical data show that democratic systems contribute
significantly to economic stability, lowering the chance of serious economic crises.
Furthermore, because of their stable governments, open policies, and protection of property
rights, democratic nations typically draw more investment and promote innovation. These
elements produce steady, long-term economic growth, a pattern frequently seen in
democracies. Furthermore, democracies place a high value on education for the growth of
human capital, which improves labor productivity and skills and fosters economic progress.
The inclusive nature of democracies frequently leads to equitable distribution of resources
and wealth, which promotes more equitable patterns of economic growth.In comparison to
non-democratic regimes, stronger democratic governance appears to be associated with
more stable, inventive, and equitable economic growth, according to these research
evaluations which collectively highlight an important connection between democratic
institutions and many positive economic indices.

Balancing Democracy and Growth: Challenges and Paths Ahead:

According to critics, there is no clear cut correlation between economic growth and
democracy, and democratization might lead to instability if it happens too quickly. Economic
progress can occur without democracy, as demonstrated by the success stories of non-
democratic countries like Singapore and China. But democracy is not a guarantee of
economic progress, and policymakers should be aware of this. To maintain a balance
between democratic values and economic growth, creative policies and flexible governance
models will be necessary in the future since the link between democracy and economic
development is likely to change with hidden dynamics.

References:

• Mohammadi, Hosein, Flavio Boccia, and Amirhossein Tohidi. 2023. "The

Relationship between Democracy and Economic Growth in the Path of Sustainable
Development" Sustainability 15, no. 12: 9607. https://doi.org/10.3390/su15129607
• https://cis.ethz.ch/content/dam/ethz/special-interest/gess/cis/cis-
dam/CIS_DAM_2015/WorkingPapers/Living_Reviews_Democracy/Wuc
herpfennig%20Deutsch.pdf
• https://digitalcommons.iwu.edu/cgi/viewcontent.cgi?article=1615&conte
xt=uer
• https://www.tandfonline.com/doi/full/10.1080/14736480802665238
• https://www.jstor.org/stable/20622725

.
.