The Dictator Effect: How Long Years in Office Affects Economic Development in Africa and the Near East

38 Pages Posted: 25 May 2012

See all articles by Jason Papaioannou

Jason Papaioannou

affiliation not provided to SSRN

Jan Luiten van Zanden

International Institute of Social History; Utrecht University

Date Written: May 2012

Abstract

This paper contributes to the growing literature on the links between political regimes and economic development by studying the effects of years in office on economic development. The hypothesis is that dictators who stay in office for a long time period will become increasingly corrupt, and that their poor governance will impact on economic growth (which is reduced), inflation (which increases) and the quality of institutions (which deteriorates). This may be related to the fact that their time horizon is shrinking: they develop (in the terminology developed by Olson) from ‘stationary bandits’ into ‘roving bandits’. Or they may get caught into a ‘disinformation trap’, caused by the ‘dictator dilemma’. We test these hypotheses and indeed find strong evidence for the existence of a dictator effect: the length of the rule is negatively related to economic growth and the quality of democratic institutions, and positively related to inflation. This effect is particularly strong in young states and in ‘single-party’ regimes. The negative effect of years in office was almost constant in time and did not disappear after about 1992.

Keywords: Africa, dictatorships, economic growth, political institutions

JEL Classification: H7, O2, O55

Suggested Citation

Papaioannou, Jason and Luiten van Zanden, Jan, The Dictator Effect: How Long Years in Office Affects Economic Development in Africa and the Near East (May 2012). CEPR Discussion Paper No. DP8962, Available at SSRN: https://ssrn.com/abstract=2066335

Jason Papaioannou (Contact Author)

affiliation not provided to SSRN

No Address Available

Jan Luiten van Zanden

International Institute of Social History ( email )

1019 AT Amsterdam
Netherlands

Utrecht University ( email )

Vredenburg 138
Utrecht, 3511 BG
Netherlands

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