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From Education to Democracy? Author(S): Daron Acemoglu, Simon Johnson, James A American Economic Association From Education to Democracy? Author(s): Daron Acemoglu, Simon Johnson, James A. Robinson, Pierre Yared Source: The American Economic Review, Vol. 95, No. 2, Papers and Proceedings of the One Hundred Seventeenth Annual Meeting of the American Economic Association, Philadelphia, PA, January 7-9, 2005 (May, 2005), pp. 44-49 Published by: American Economic Association Stable URL: http://www.jstor.org/stable/4132788 Accessed: 11/09/2009 16:40 Your use of the JSTOR archive indicates your acceptance of JSTOR's Terms and Conditions of Use, available at http://www.jstor.org/page/info/about/policies/terms.jsp. JSTOR's Terms and Conditions of Use provides, in part, that unless you have obtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the JSTOR archive only for your personal, non-commercial use. Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained at http://www.jstor.org/action/showPublisher?publisherCode=aea. Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission. JSTOR is a not-for-profit organization founded in 1995 to build trusted digital archives for scholarship. We work with the scholarly community to preserve their work and the materials they rely upon, and to build a common research platform that promotes the discovery and use of these resources. For more information about JSTOR, please contact [email protected]. American Economic Association is collaborating with JSTOR to digitize, preserve and extend access to The American Economic Review. http://www.jstor.org FromEducation to Democracy? By DARON ACEMOGLU,SIMON JOHNSON,JAMES A. ROBINSON,AND PIERREYARED* The conventional wisdom, since at least the and argue that differences in schooling are a writings of John Dewey (1916), views high major causal factor explaining not only differ- levels of educational attainmentas a prerequi- ences in democracy, but more generally in po- site for democracy. Education is argued to pro- litical institutions, and they provide evidence mote democracy both because it enables a consistent with this view. "cultureof democracy"to develop and because Existing literaturelooks at the cross-sectional it leads to greater prosperity, which is also correlation between education and democracy thought to cause political development. The ratherthan at the within variation.Hence exist- most celebrated version of this argumentis the ing inferences may be potentially driven by modernizationtheory, popularizedby Seymour omitted factors influencing both education and Martin Lipset (1959), which emphasizes the democracy in the long run. A causal link be- role of education as well as economic growth in tween education and democracy suggests that promoting political development in general and we should also see a relationship between democracy in particular. For example, Lipset changes in education and changes in democ- (1959 p. 79) argues that racy. In other words, we should ask whether a given country(with its other characteristicsheld Education presumably broadens men's constant) is more likely to become more dem- enables them to understandthe outlooks, ocratic as its population becomes more edu- need for norms of tolerance, restrains cated. We show that the answer to this them from to extremist and mo- question adhering is no. 1 illustrates this the nistic doctrines, and increases their Figure by plotting capac- in the Freedom House score ity to make rational electoral choices change democracy between 1970 and 1995 versus the change in and he concludes (p. 80) that average years of schooling duringthe same time period (see below for data details). Countries If we cannot say that a "high" level of that become more educated show no greater education is a sufficient condition for de- tendency to become more democratic. mocracy, the available evidence does sug- We further investigate these issues econo- gest that it comes close to being a metrically. We show that the cross-sectional necessary condition. relationship between schooling and democracy disappears when country fixed effects are in- Recent empirical work, for example, by Rob- cluded in the regression. Although fixed-effects ert Barro (1999) and Adam Przeworski et al. regressions are not a panacea against all biases (2000), provides evidence consistent with this arising in pooled ordinary least-squares(OLS) view. Edward Glaeser et al. (2004) go further regressions, they are very useful in removing the potential long-run determinantsof both ed- ucation and democracy. We also documentthat * Acemoglu: Departmentof Economics, Massachusetts the lack of a relationshipbetween educationand Institute of Technology, 50 Memorial Drive, Cambridge, democracy is highly robust to different econo- MA 02142 (e-mail: [email protected]); Johnson: Sloan metric to estimation in various dif- School of MassachusettsInstitute of Technol- techniques, Management, ferent and to the inclusion of different ogy, 50 Memorial Drive, Cambridge, MA 02142 (e-mail: samples, [email protected]);Robinson: Departmentof Government, sets of covariates. Harvard University, 1033 Massachusetts Avenue, Cam- The recent paperby Glaeser et al. (2004) also bridge, MA 02138 (e-mail: [email protected]); exploits the time-series variation in democracy Yared: Departmentof Economics, Massachusetts Institute and education and evidence that of Technology, 50 Memorial Drive, Cambridge,MA 02142 presents (e-mail: [email protected]).We thankGerard Roland for com- changes in schooling predict changes in democ- ments and discussion. racy and other political institutions. However, 44 VOL.95 NO. 2 THE DEMOCRATICTRANSITION AND ECONOMICGROWTH 45 > 1.0 basic data set is a five-yearly panel, where we take the democracyscore for each countryevery E fifth year. We prefer using the observations O ~j?i??????????---C~ -- --- - - - every fifth year to averaging the five-yearly Qo data, since averaging introduces additional se- rial correlation (the results are robust to using five-year averages). Our main right-hand-sidevariable, average 0 2 4 6 years of schooling in the total populationof age Change in Average Years of Schooling (Barro-Lee) 25 and above, is from Barro and Jong-WhaLee (2000) and is available in five-year intervals FIGURE1. DEMOCRACYGROWTH AND EDUCATION between 1960 and 2000. The value of this vari- GROWTH,1970-1995 able in our base sample ranges from 0.04 to 12.18 years of schooling, with a mean of 4.44. Table 1 provides our main results using the we document below that this result stems from Freedom House data. Column (i) shows the their omission of time effects in the regressions, pooled OLS relationshipbetween educationand so it reflects the over-time increase in education democracy by estimating the following model: and democracy at the world level over the past 35 Once we include dummies in years. year + + their the of education on (1) di, = adi,,t_1 ysi,tl - vit regressions, impact -Lt+lt democracy disappears entirely. Motivated by the Glaeser et al. (2004) paper, we also show where di, is the democracy score of country i in that there is no effect of education on other period t. The lagged value of this variable is measures of political institutions. included on the right-handside to captureper- This paper is part of our broader research. sistence in democracy and also potentially The companion paper (Acemoglu et al., 2004) mean-reverting dynamics in democracy (i.e., investigates the other basic tenet of the modern- the tendency of the democracyscore to returnto ization hypothesis, that income (and economic some equilibrium value for the country). The growth) causes democracy. In that paper, using main variable of interest is si,t-1, the lagged both fixed-effects OLS and instrumental- value of averageyears of schooling. The param- variable regressions, we show that there is little eter y thereforemeasures whether education has evidence in favor of a causal effect from income an effect on democracy. The parameter ,t de- to democracy either. We also offer a theory for notes a full set of time effects, which capture the differences in long-run factors causing the common shocks to (common trends in) the de- joint evolution of education, income, and de- mocracy score of all countries,and vi, is an error mocracy, and we provide supporting evidence term, capturingall other omitted factors. for this theory. Column (i) shows a statistically significant correlationbetween education and democracy. I. Education and Democracy The estimate of y is 0.027 with a standarderror of 0.004, which is significant at the 1-percent We follow the existing literaturein econom- level (all the standarderrors are robust for ar- ics and measure democracy using the Freedom bitrary heteroscedasticityand clustering at the House Political Rights Index. This index ranges country level). If causal, this estimate would from 1 to 7, with 7 representing the least imply that an additional year of schooling in- amount of political freedom and 1 the most creases the "steady-state"value of democracy freedom. Following Barro (1999), we supple- by 0.093 (~0.027/[1 - 0.709], where the long- ment this index with the related variable from run effect is calculated as y/[1 - a]). This is a Kenneth Bollen (1990) for 1955, 1960, and reasonablylarge magnituderelative to the mean 1965, and we transform both indexes so that of democracy in
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