Democratization and Clientelism: Why are Young Democracies Badly Governed?

Abstract

This paper identifies and explains systematic performance differences between younger and older democracies: younger democracies are more corrupt; exhibit less rule of law, lower levels of bureaucratic quality and lower secondary school enrollment; and spend more on public investment and government workers. One explanation for this is that politicians in young democracies are less credible. Keefer and Vlaicu (2004) argue that the inability of political competitors to make credible promises to citizens leads them to underprovide public goods, overprovide transfers to narrow groups of voters, and engage in excessive rent-seeking. A variety of tests suggest that this is the only theory that explains the performance of young democracies. The effect of democratic age remains large even after controlling for the possibilities that voters are less well-informed in young democracies, that young democracies have systematically different political and electoral institutions, or that young democracies exhibit more polarized societies.