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The debate about the relationship between democracy and economic development seems to have been reconciled by Gabriel Almonds work, which states that democracy and capitalism are both positively and negatively related, that they both support and subvert each other. Yet, in recent literature the debate about the topic is not finished. This paper focuses specifically on how economic development affects democracy. Scholars such as Fish, Kwon, Mainwaring, Perez-Linan, Bellin, Przeworksi, and Limongi believe that, to a certain degree, economic development promotes democracy. On the other hand, Kwon explicitly rejects the possibility of contingency at the country level.
In order to measure the level of democracy, there are two independent variables in this research paper: Political Right (PR) and Civil Liberty (CL). Data for these two variables are taken from Freedom House in the World Historical Rankings Comparative Scores for all countries from 1973 to 2006. The data are ranked from 1 (very democratic) to 7 (very undemocratic), for both variables. The economic development indicators used in this research as the dependent variables are: GDP growth, GNI per capita, foreign investment, inflation rate, and trade. Data for those variables are taken fromWorld Bank under WDI (World Development Index) dataset.
This paper concludes that the model of how economic development affects democracy works differently in countries studied. This is proof of how universalism (Fish and Bellin) and regionalism (Kwon, Przeworski and Limongi, and Mainwaring and Perez-Linan) do not apply in Southeast Asia.
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