Dictatorship, Democracy, and development

under what conditions does a system of anarchy exist under

theft by roving bandits destroys the incentive to invest and produce which leaves little for the population and bandits

what causes anarchy to better

a stationary bandit who is able to monopolize and rationalize theft in the form of taxes

what does a secure autocrat have an intrest in

a secure autocrat has an interest in his domain which leads him to provide a peaceful order and public goods which increases productivity

what occurs when a secure autocrat has a short tenure

a secure autocrat with a short tenure confiscates assets whose tax yields over his tenure his less than their total value hast w

what are the consequences of a secure autocrat

this implies that autocracies will rarely have good economic performance.

what are the conditions which are necessary for lasting democracy

they are the same which are necessary for the security of property and contract rights which generate economic growth

under which conditions can a society not work

a society cannot work if it does not have a peaceful order and other public goods

what is an assumption that can be made about a peaceful order

a peaceful order emerges through voluntary agreement in small communities but not large populations

why doesn't voluntary agreement work in large populations

the typical idnidual in a society of a million will only get a millionth from a collective good, but will bear the full cost of providing it.

how have populous societies avoided anarchy

through the rational monopolization of theft to uncoordinated competitive theft in contrast to the uncoordinated competitive theft. The victims of theft can expect to retain whatever captital they accumulate out of tax income and therefore also have an incentive to save and invest, thereby increasing future income and tax receipts

how is anarchy eliminated

monopolization of theft and the protection of tax generating subjects. Since the warlord takes a part of total production ion the form of tax theft. It will also pay him to provide other public goods to increase taxable income

what is the first blessing of the invisible hand

in a world of roving banditry there is no incentive for anyone to produce or accumalate anything. this rationally induces the bandit leader to seize a domain and to provide a peaceful order and other public goods for its inhabitants, thereby obtaining more in tac than he could’ve from migratory plunder

how do governments in large soctieis arise

they arise not because of social contracts but becasue there is a rational self interest among those who organize the greatest capacity for violence

why would an autocrat provide public goods

an autocrat has one encompassing interest; the larger the stake an organization or individual has to take action to provide Public goods

what is the grasping hand

the autotcrat is not a position anbalkogus to the owner of all wealth, both tangible and human in a. country. not just in a house here does t

where does the autocrat get his receipts from

the autocrat gets all of his receipts in the form of explicit taxation

what is a rational autocrat

an autocrat which devotes some of the resources he obtains through taxation to public goods but will impose higher taxation rates than what is needed to maximize his net surplus

what form of taxation does an autocrat choose

the revenue maximizing rate

what does a self interested autocrat do in terms of net surplus

he takes for himself there largest net surplus

why doesn’t a rational autocrat have an incentive to push tax rates to the revenue maximizing level

the majority in additon earns a significant share of market income of society giving a more encompassing interest in the productivity of society. majority interest in market earnings induces it to redistribute less to itself than an autocrat redistributes to himself

when will an economy generate its maximum, income

only if there is High rate of investment and return on long term investments is releveled

what will occur under a short term autocrat

he will gain by expropriating any convenient capital asset whose tax yield over the year is less than its total value. He will also gain from foregtting about enforcement of long term contracts, and form coining or printing new money that he can spend (inflation) short term horizon

how do democracies emerge of autocracies

spontaneous emergence of democracy iOS the absence of commnplace conditions that generate autocracy /