Poverty reduction strategies aim to foster growth patterns that favour the poor (millennium development goals and poverty reduction strategy papers). However, in the past rapid economic expansion in developing countries has often been associated with increased inequality. Redistributive policies could counteract such trends. But redistribution and poverty alleviation policies are not always chosen because of efficiency, rather they prove to be a result of political processes. Therefore, such policies are likely to differ according to political regime type The project’s basic questions are thus as follows:
- How and why do redistribution and pro-poor policies differ between political regimes (democracies, autocracies, hybrid regimes)?
- Which policy or policy mix is most effective for poverty alleviation in specific regimes?
- Which political conditions are effective institutional arrangement for poverty reduction?
Contribution to International Research
The general assumption is that democracies are more responsive to public demands than authoritarian regimes; hence democracies are more likely to adopt policies to combat poverty and promote redistribution. However, autocracies may choose certain types of social policies to please citizens and relax the revolutionary threat. Quite a few studies focus on how political institutions influence social policies and what distortions they generate for poverty reduction strategies. What kind of pro-poor policy mix given specific political constraints is most effective and efficient remains unclear. Further, cross-country research on the relationship between political regimes and poverty/inequality is inconclusive. There are various reasons for this state of affairs: case and period selection, the limitations of the statistical instruments, and conceptual and measurement shortcomings.
Research Design and Methods
Our approach will enhance the differentiation of the regime variable to overcome the democracy/dictatorship dichotomy by introducing hybrid-regime categories as well as disentangle particular political institutions that are crucial for social policy choices and implementation. In addition, we will specify different qualities within the regime categories, such as diminished subtypes and partial regimes. We intend to
- assess the relationship between poverty/inequality and regime type;
- examine which policies are most likely to be adopted by specific regime types; and
- analyse the differences in the effectiveness and efficiency of specific policies under different regime types.
Such an analysis will provide answers as to why some countries are less effective in poverty reduction or less intend to adopt certain types of social policies. The study will comprise both a cross-country large-N analysis and within-country evaluation of specific policies. A small-N comparison of selected country cases from Africa, Asia and Latin America according to regime type, policies, and governance efficacy will help to identify key variables and main patterns of pro-poor policies across regimes.
We have collected data on non-contributory pro-poor transfers in all developing countries for 1960-2015. Our data comprises transfers that are rolled out on a large scale at the national level and that are independent of recipients’ employment. Exploiting these cross-country panel data we show that the probability of having a transfer program is higher in democracies than in autocracies. This implies that democracies redistribute more than autocracies through pro-poor transfers. We also find that conditional cash transfers, that link the receipt of cash transfers to investments in children’s health and schooling, are more often chosen under more democratic regimes. Since such human capital investments will only pay off in a relatively distant future, the motive to implement conditional cash transfers is rather one of fostering long term development than a political one. Related to this, we find that more autocratic regimes are more likely to employ methods for beneficiary selection that allow the allocation of transfers to political supporters or to groups that should be appeased. Finally, we contribute knowledge on whether social policies can change political behaviour. In two country cases, Mali and Ghana, we find that conditional cash transfers lead to a decrease in non-electoral political participation of citizens. The basic insight is that the implementation of a transfer program can lead to reduced opposition activities such as taking part in demonstrations.