Getting What Right?

First off, nice pun Barro. My dad would approve. What is “it” exactly? The market, everything, government, what?! Is “it” our understanding of how our choices determine our interactions in society? Does “it” include conceptions of morality and culture, two concepts that might shape our economic decisions? Good question, Sarah.

On The Role of Political Institutions
Barro presents evidence that movements toward democracy promote growth when political freedoms are weak but inhibit growth when a moderate amount of freedom has already been attained. Basically, as democracies become older, the tendency to redistribute income and other resources becomes an impediment to growth. The resources are moved away from their most productive (read: “efficient”) uses. Barro doesn’t say that governments cannot affect long-term growth, they merely tend to go awry when trying to implement policies that have important effects in the long-term. Sure, any purposeful action has unintended side-effects but I still take ibuprofen even though it gives me a stomach ache. Corey Brettschneider would have a field day with Barro. The procedural and substantive implications of political autonomy, equality of interests, and reciprocity are what gives democracy its substance; they aren’t constraints.

Barro’s use of a country’s standard of living to forecast the growth and decline of democracy is interesting. My statistical experience may be limited, but are standard of living and democracy unrelated? Using this data, Barro shows that improvements in the standard of living increase the probability that political institutions will become more democratic. In contrast, an increase in political freedom has an overall negative (but small) impact on growth (11). To Barro, democracy isn’t a magic bullet, nor should it be considered as such. This seems to imply that he doesn’t seem to value democratization as a process.