《《eScholarship UC item 2rj6p432》.pdfVIP

University of California Peer Reviewed Title: The Economics of Autocracy and Majority Rule Author: MCGUIRE, MARTIN C, University of California, Irvine Olson, Mancur L Jr, University of Maryland Publication Date: 03-01-1996 Publication Info: Postprints, UC Irvine Permalink: /uc/item/2rj6p432 Additional Info: Copyright 1996, American Economic Association. Journal of Economic Literature, Vol. XXXIV (March 1996), pp. 72–96. Original Citation: Martin C. McGuire and Mancur L. Olson: The Economics of Autocracy and Majority Rule: The Invisible Hand and the Use of Force, Journal of Economic Literature, Vol. XXXIV (March 1996) pp. 72–96 Keywords: Governance, Autocracy, Democracy, Property Rights, Income Distribution Abstract: Productive public good investment allocations, and group discriminatory redistributions are conflicting resource use options between which every government must choose irrespective of its political make up. This paper is the first to derive an incisive explanation of how governments combine political and economic calculation to balance these competing choices. The political logic of these economic decisions will lie on a spectrum between two polar extremes. At one extremes is an idealized, utopian, consensual democracy. At the other extreme is perfect autocracy ruled by a dictator who taxes and spends solely to satisfy his own selfish desires. Realistic societies can be analyzed as a mixture -- a weighted sum -- of these two polar cases. Thus, in making the choice between social investment and redistributive taxation from the powerless to the powerful, every government behaves somewhat like an pure democracy and somewhat like a selfish dictatorship eScholarship provides open access, scholarly publishing services to the Univers