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The Economic Foundations of Authoritarian Rule

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The Economic Foundations of Authoritarian Rule University of South Carolina Scholar Commons Theses and Dissertations 2017 The conomicE Foundations of Authoritarian Rule Clay Robert Fuller University of South Carolina Follow this and additional works at: https://scholarcommons.sc.edu/etd Part of the Political Science Commons Recommended Citation Fuller, C. R.(2017). The Economic Foundations of Authoritarian Rule. (Doctoral dissertation). Retrieved from https://scholarcommons.sc.edu/etd/4202 This Open Access Dissertation is brought to you by Scholar Commons. It has been accepted for inclusion in Theses and Dissertations by an authorized administrator of Scholar Commons. For more information, please contact [email protected]. THE ECONOMIC FOUNDATIONS OF AUTHORITARIAN RULE by Clay Robert Fuller Bachelor of Arts West Virginia State University, 2008 Master of Arts Texas State University, 2010 Master of Arts University of South Carolina, 2014 Submitted in Partial Fulfillment of the Requirements For the Degree of Doctor of Philosophy in Political Science College of Arts and Sciences University of South Carolina 2017 Accepted by: John Hsieh, Major Professor Harvey Starr, Committee Member Timothy Peterson, Committee Member Gerald McDermott, Committee Member Cheryl L. Addy, Vice Provost and Dean of the Graduate School © Copyright Clay Robert Fuller, 2017 All Rights Reserved. ii DEDICATION for Henry, Shannon, Mom & Dad iii ACKNOWLEDGEMENTS Special thanks goes to God, the unconditional love and support of my wife, parents and extended family, my dissertation committee, Alex, the institutions of the United States of America, the State of South Carolina, the University of South Carolina, the Department of Political Science faculty and staff, the Walker Institute of International and Area Studies faculty and staff, the Center for Teaching Excellence, undergraduate political science majors at South Carolina who helped along the way, and the International Center on Nonviolent Conflict. This work was partially supported by a SPARC Graduate Research Grant from the Office of the Vice President for Research at the University of South Carolina and the Sueng Yeun Kim dissertation grant from the Center for Asian Studies at the Walker Institute. I would especially like to acknowledge approximately half of Earth’s population currently living under some form of non-democracy. This work is not intended to disparage you or your country or your culture in any way shape or form. This work is designed to 1) help foster understanding and cooperation between people that reside in democracies and those that live in dictatorships, 2) highlight nonviolent approaches to governance that can hopefully prevent some of the atrocities that tend to occur more often in dictatorships, and 3) move us further along in the quest for a universal understanding of good governance. Henry, remember that knowledge is one thing that no person and no government can ever take away from you. Acquire as much of it as you possibly can. iv ABSTRACT Personal ambition and the distribution of economic goods often determine the character of politics. This dynamic plays out dramatically in authoritarian states where there are few independent arbiters outside of political violence. All dictatorships face two paramount problems in maintaining their tenure. First, to maintain power and distribute goods dictators must devise ways in which to manage a ruling coalition in the absence of explicit power-sharing institutions. Second, authoritarian regimes must devise ways to manage the desires of a population ruled with only implicit consent. This dissertation empirically treats the management style of authoritarian leaders as exogenous to the institutional composition of his regime, thus breaking from traditional authoritarian typologies. It utilizes original data and finds evidence that dictatorships can strengthen and survive longer, and in a nonviolent manner, with creative elite and popular economic management tools such as special economic zones (SEZs) and sovereign wealth funds (SWFs). More specifically, it finds that violent and corrupt leaders that develop these economic tools can possibly be removed from power or eventually become constrained by the policies because the policies attach the leader and the regime to independent arbiters. At the regime level, SEZs and SWFs extend the survival of all types of regimes, despite institutional setting, through the mechanisms of labor fragmentation and sunk investments. Seemingly democratic institutions in dictatorships – parties, elections, legislatures – may be the foundation of democratic rule, but they are not the foundation of authoritarian rule – economic policy is. v TABLE OF CONTENTS DEDICATION ....................................................................................................................... iii ACKNOWLEDGEMENTS ...................................................................................................... iv ABSTRACT ............................................................................................................................v LIST OF TABLES ............................................................................................................... viii LIST OF FIGURES ................................................................................................................ ix LIST OF ABBREVIATIONS ................................................................................................... xi CHAPTER 1: INTRODUCTION ................................................................................................1 1.1 AUTHORITARIAN RULE................................................................................... 14 1.2 ECONOMIC POLICIES AND ELITE MANAGEMENT.............................................. 20 1.3 ECONOMIC POLICIES AND POPULAR MANAGEMENT ........................................ 23 CHAPTER 2: CHARACTERISTICS OF AUTHORITARIAN RULE ......................................... 28 2.1 AUTHORITARIAN POLITICAL INSTITUTIONS ..................................................... 32 2.2 AUTHORITARIAN TYPOLOGIES ........................................................................ 41 2.3 AUTHORITARIAN ECONOMIC POLICIES ............................................................ 72 CHAPTER 3: ELITE MANAGEMENT THROUGH ECONOMIC POLICY ............................... 95 3.1 CREDIBLE COMMITMENTS ............................................................................ 105 3.2 INDEPENDENT ARBITERS .............................................................................. 109 3.3 AN EXAMPLE WITH SEZS – KISH TRADE-INDUSTRIAL FREE ZONE (IRAN) ..... 112 3.4 AN EXAMPLE WITH SWFS – FERRARI WORLD (ABU DHABI, U.A.E.) ............ 119 3.5 EXAMINATION OF LEADER TENURE .............................................................. 124 vi CHAPTER 4. POPULAR MANAGEMENT THROUGH ECONOMIC POLICY ........................ 137 4.1 LABOR FRAGMENTATION ............................................................................. 148 4.2 SUNK INVESTMENTS ..................................................................................... 156 4.3 AN EXAMPLE WITH SEZS – BREST SPECIAL ECONOMIC ZONE (BELARUS) ..... 158 4.4 EXAMINATION OF REGIME SURVIVAL ........................................................... 161 CHAPTER 5. CONCLUSION ........................................................................................ 169 WORKS CITED ......................................................................................................... 172 APPENDIX A: ALTERNATE FIGURE 2.2 ..................................................................... 185 APPENDIX B: FACTOR SCORE LOADINGS ................................................................. 186 APPENDIX C: KAPLAN MEIER SURVIVAL ESTIMATES ............................................... 188 vii LIST OF TABLES TABLE 2.1 LEADER TO REGIME CONFIGURATIONS OF ESTABLISHED AUTOCRATS ....... 57 TABLE 2.2 PERSONALIST LEADERS, DATES, EXIT, AND DEATH, 1946-2017 ................ 58 TABLE 2.3 FACTORS OF AUTOCRATIC MANAGEMENT STYLES .................................... 63 TABLE 2.4 WORLD EXPORT PROCESSING ZONES, 1975-2006 ..................................... 76 TABLE 2.5 POTENTIAL DIRECT AND INDIRECT BENEFITS OF SEZS .............................. 78 TABLE 2.6 CODING SCHEME FOR SPECIAL ECONOMIC ZONE PROGRAM ...................... 83 TABLE 2.7 PERCENTAGE OF COUNTRY-YEARS WITH SEZ SCORE OVER TIME ............. 84 TABLE 2.8 SAMPLE OF DEMOCRATIC SWFS AND THE IMPETUS FOR CREATION ........... 88 TABLE 2.9 SAMPLE OF AUTOCRATIC SWFS AND THE IMPETUS FOR CREATION ............ 88 TABLE 2.10 SOVEREIGN WEALTH FUNDS AND TRANSPARENCY RATINGS ................... 93 TABLE 2.11 THE TIMING OF SWF CREATION ............................................................. 94 TABLE 2.12 REGIONAL DISTRIBUTION OF SWFS, 2015............................................... 94 TABLE 3.1 LEADER EXIT BY MANAGEMENT STYLE .................................................. 127 TABLE 3.2 LEADER EXIT BY TYPE AND SEZ SCORE, 1981-2008 ............................... 129 TABLE 3.3 OLS ESTIMATES OF DICTATOR YEARS IN OFFICE, 1981-2008 ................. 132 TABLE 3.4 LEADER SURVIVAL ................................................................................. 135 TABLE 4.1 DEMOGRAPHIC BREAKDOWN OF THE UAE .............................................. 154 TABLE 4.2 REGIME SURVIVAL ................................................................................. 164 viii LIST OF FIGURES FIGURE 2.1 EFFECTIVE NUMBER OF POLITICAL PARTIES
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