The Logic of Political Survival Code
B. de Mesquita's research indicates democratic nations are richer, and they are richer because of democracy. The relationship is not mere correlation - it is causation. But we need to define democracy carefully.
A country's well-being depends on the size of its "winning coalition", let's give it the variable W, the larger the better (in democratic countries W is the entire population).
Winning coalition W is # of people whose support a leader needs to rule, this is the group of people he needs to keep happy to stay in power, selectorate S is the # of people from among which members of W are recruited.
With small W, leader only needs to keep a small group happy paying them off is easier, with large W, bribe becomes harder so leader must emphasize public services, striving to be elected on the basis of policy. S in a democracy is the entire electorate, for autocracies a much smaller group would do i.e. the military, or some sort of "guard", or a single party out of which even a smaller W would select the leader.
In The Logic of Political Survival BBM makes the case that it is better to use W as a measure of better governance. According to this research increases in W effect GDP growth positively. Here is the causation part - BdM calculates increase in W based as difference between W of two years ago and calculates its relation between the current year's growth. The relation exists.
BdM also controls for what it is traditionally known as democracy. In a separate regression he takes out effects of W,S from inside this traditional "democracy" variable, so what remains (the residuals) are taken to be all other parts (benefits?) of democracy that is not related to W or S. This residual has no effect on the regression, meaning traditional concept of democracy is irrelevant.
Another hypothesis is that there is a dependence between kleptocracy and W, S; and yes the book finds government theft is maximal when W is small and S is large, signifying a rigged electoral system where the electorate is large but their votes do not count, an inner circle decides everything. With bigger W, kleptocracy decreases.
Once the general richness of society is accounted for, there is a negative correlation between construction (an area ripe for government theft) and the winning coalition size, W, meaning better governance means less construction that involve theft. Rich societies naturally build more, or they build in proportion to their income, and if they are governed well no more than necessary. The "more" of this extra construction can involve shady dealings and that part is caught by the regression.
There's a very nicely prepared dataset associated with the book The Logic of Political Survival (2003) written by Bruce B. Mesquita et al. along with code that can reproduce its statistical results. BBM is famous for The Predictioneer's Game (2009), where he detailed the use of game theory for negotations / war. It turns out he had another theory on governments, democracies, dictatorships in the earlier book. In this earlier work the claim is that it is not enough to use labels such as democracy, autocracy to describe / predict which countries to develop and others not. His main thesis is that the two most important variables in a country are W and S, the winning-coalition size and the selectorate size.
Winning coalition W is # of ppl whose support a leader needs to rule, this is the group of people he needs to keep happy to stay in power, selectorate S is the # of people from among which members of W are recruited. With small W, leader only needs to keep a small group happy paying them off is easier, with large W, bribe becomes harder so leader must emphasize public services, striving to be elected on the basis of policy. S in a democracy is the entire electorate, for autocracies a much smaller group would do i.e. the military, or some sort of "guard", or a single party out of which even a smaller W would select the leader.
BBM hypothizes there is a dependence between kleptocracy and W, S; he finds government theft is maximal when W is small and S is large, signifying a rigged electoral system where the electorate is large but their votes do not count, an inner circle decides everything. With bigger W, kleptocracy decreases.
A counterargument could be there is a hidden effect of population size on theft, more people, more revenue hence more chances to steal, or even foreign aid can tip the balance, but BBM "accounts for those variables (a statistics term)" in his calculations ,taking their effect out, keeping the focus on W and S. Kleptocracy value itself is the absolute value difference between tax revenue and expenditures in proportion to GDP. Absolute value is used because both deficits and surpluses can be a sign of theft; leader can steal surplus revenue after its reported or, overspend (on cronies, on their insane pet projects) which would result in deficit.
Another hypothesis is there is positive relationship between W and income, countries with larger winning-coalitions are richer, and this is also confirmed. With everything else the same a country going from W=0 to W=1 would add 3.0% growth to per capita income. This could seem small, but if you take per capita income 10,000 dollars in 10 years,
R=0.03; print 10*1000 * ((1+R)**10.)
it becomes a whopping 13,439 dollars. So increasing the winning coalition to its maximum from the worst adds to per capita more than 3,000 dollars.
[geek]
I ran the regressions myself, both as ordinary linear regression and as a multilevel model using region/year as the group. I was able to reproduce results close to what BBM reports, I say close because I left out some variables (the stuff that BBM ended up finding unimportant). In kleptocracy model for example R^2 is 20% (BBM gets over 40%) which is very good. All variables are significant.
Here is how to reproduce W from scratch.
There is some mad skillz displayed in accounting for "traditional democratic" effects that could be seperate from W and S. For that, BBM take W,S into regression against Polity's democracy, takes the residuals, feeds them into the main regression coupled with their variable in question. This way traditional democratic effects, or what Polity thinks as democracy is controlled for, only coalition and selectorate size effect remain. F..in A.
I used a combination of Python and R. The book uses Stata (a closed source software -nasty- but I was glad to have some software accompanying the book).
[/geek]
Calculating actual W and S is the tricky business. Ideally you'd want
to know the exact size, let's say country X has a military
dictatorship, the military size is 100K, out of which a junta of size
10 rules the country, then S=100K and W=10. But this kind of data is
hard to collect, the authors decided to use another dataset's base
variables to derive W and S. This formula is educational on its
own. The dataset is Polity IV, famous for capturing
some base variables on countries' democratic development which also
has its own democracy variable that BBM et. al did not use directly,
the variables used for W derivation are RegimeType, xrcomp, xropen,
parcomp.
Among these parcomp was interesting for me, getting a 5 on that adds
a 1 to your score, and many countries including Turkland has a 4, and
you look up the description for that in Polity manual which says: (4)
Transitional: Any transitional arrangement from [1,2,3] patterns to
fully [5] patterns [..]. Transitional arrangements are accommodative
of competing, parochial interests but have not fully linked parochial
with broader, general interests. This is funny bcz the presence of
"parochial interests" is a good word to describe TR at the moment.
The best score for W is 1.0. Some surprises, Singapore is rightly known for its lack of democracy and it gets a 0.4 from Polity, but its W is 0.75, a score shared by Venezuella and TR. US before Civil War scores 0.95 on democracy but 0.75 on W. In all these cases W does a better job in capturing the essence of a regime.
The research in this book appears to have evolved into The Dictator's Handbook, again by BBM.
Elections
US elections (most likely elections in other democratic countries as well) are decided as a go / no-go decision on the incumbent party. While judging the incumbent only three variables are used: GDP growth, party incumbency (second term or not), and incumbent executive's net approval rating. The prediction works very well on almost all US election data.
It is interesting the analysis works well with such rough / few numbers such as growth and general popularity. But in a way this makes sense; Voting for a single person is a blunt instrument really, hence, the basis people use to judge it is also pretty general. If a party stays in power for too long, people want to throw them out, if there is no growth, the incumbent is not popular, the climb for the candidate from that party becomes steeper and steeper. The method is very smart in some sense because the only reliable data the electorate has can only be based on existing accomplishments (through these general variables), that's why the vote is based incumbent, i.e. the person on whom people have the best available data.
People do not judge candidates by looking at the totality of their policy positions (hmm I assign a number from 1 to 10 to each position, then average them all, compare both candidates,that is the likelihood of my vote). People are much better deciding on people, not on issues. This also implies that a win does not validate a politician's all policy positions, since people mostly did not give a shit about them. Taking the vote as a confirmation of all previously positions, locking them in, or thinking people are some kind of magical policy oracle is a fallacy. Everyone has a job to do - modernity is based on the division of labor. Post-modernity could be something else, we are not there yet.
Which election system is best? BdM has good things to say on the French run-off system, being more demanding. From BdM's The Dictator's Handbook:
"It is worth observing that the United States has one of the world’s biggest winning coalitions both in absolute numbers and as a proportion of the electorate. But it is not the biggest. Britain’s parliamentary structure requires the prime minister to have the support of a little over 25 percent of the electorate in two-party elections to parliament. That is, the prime minister generally needs at least half the members of parliament to be from her party and for each of them to win half the vote (plus one) in each two-party parliamentary race: half of half of the voters, or one quarter in total. France’s runoff system is even more demanding. Election requires that a candidate win a majority in the final, two-candidate runoff."
Coalitions
In democratically backward countries that live in a comotose, proto-fascistic state a "coalition" is created beforehand, in the mind of a fascist, and any ideology that is outside of this legit mix is immediately delegitimized. This is a mistake. The emergent, self-organized blocks of ideologies, as clusters, carry within a good signal, if enough though leaders coalesced around something, chances are there is an approach that needs representing.
Logistically coalitions are fine, but you need ideologically distinct parties.. There can be no gaps, nothing left out, otherwise fascists will step in to fill the void. Obviously some coalitions will be able to deliver more than others, but at least seperate parties decide how that coalition is formed, on their own terms. Each viewpoint contributes, and by averaging the optimal decision is reached.
BTW "average" could also be a long-run average between two (or more) views (cld be immed avg too). One party cld be for 30% tax rate, another for 70%. Each enact their thing one in power, if they can, long-running average is 50%.
War
Democracies are better at war. They win almost all the wars they start and about two-thirds of the wars in which they are targets of aggression. Democracies are better able to make war collectively. Autocracies, with the small winning coalitions [..] tend to seek private benefits from fighting. A thirst for private goods means that autocracies optimize at a smaller coalition size to avoid diluting the spoils of war. Democracies, in contrast, already supply public goods to large domestic winning coalitions [4]. In essence, since democratic leaders need to inform the public and provide public goods, and war is always ugly, they have a huge interest in finishing the war as soon as possible. To that end they mobilize better, plan more effectively and fight to finish. This makes them better fighters. Autocrats can hide the goings-on of a war, so they would never feel the pressure to finish, hence do not fight in a way that'll help them do so. The war drags on.