How far does democracy contribute to economic growth & development?

Asked by vatsalchoudhary41 | 28th Oct, 2015, 03:17: PM

Expert Answer:

The contribution of democracy towards economic growth and development is a debatable topic. However, sometimes democracy has proven helpful.

  • Democracy consists of various stable and predictable institutions and tends to implement those policies that are beneficial to private enterprise. Thus, it results in higher rates of economic growth over the long period of time.
  • As democracy is accountable to the public rather than to privileged, they produce more public goods, invest more in human capital, maintain the rule of law, and protect private property rights.
  • Democracy engages more in large-scale redistribution than autocracies; however, the various negative effects of redistribution are offset by the fact that democracies have lower barriers to entry, promoting competition, and innovation.

Answered by Akanksha Kaul | 29th Oct, 2015, 12:24: PM

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