Publication Type

Working Paper

Version

publishedVersion

Publication Date

1-2009

Abstract

In order to explain the apparently paradoxical presence of acceptable governance in many non-democratic regimes, economists and political scientists have focused mostly on institutions acting as de facto checks and balances. In this paper, we propose that population plays a similar role in guaranteeing the quality of governance and redistribution. We argue and demonstrate with historical evidence that the concentration of population around the policy making center serves as an insurgency threat to a dictatorship, inducing it to yield to more redistribution and better governance. We bring this centered concept of population concentration to the data through the Centered Index of Spatial Concentration developed by Do & Campante (2008). The evidence supports our predictions: only in the sample of autocracies, population concentration around the capital city is positively associated with better governance and more redistribution (proxied by post-tax inequality), in OLS and IV regressions. Finally, we provide arguments to dismiss possible reverse causation as well as alternative, non-political economy explanations of such regularity, discuss the general applicability of our index and conclude with policy implications

Keywords

Capital Cities, Gravity, Governance, Inequality, Redistribution, Population Concentration, Revolutions, Harmonic Functions, Axiomatics

Discipline

Political Economy | Public Economics

Research Areas

Macroeconomics

First Page

1

Last Page

39

Publisher

SMU Economics and Statistics Working Paper Series, No. 01-2009

City or Country

Singapore

Copyright Owner and License

Authors

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