Democracy, consumption, and growth in sub-Saharan Africa

Abstract

This article studies the effect of political regime type on economic growth in sub-Saharan Africa. Democracy promotes growth because it conditions government consumption so that consumption is used for public purposes rather than private needs and this in turn leads to faster growth. By conditioning consumption towards public goods and away from private goods, we should see that consumption in democratic regimes is associated with more public goods like roads and education while in authoritarian regimes consumption yields less of these goods. Likewise, consumption should be associated with falling fertility in democratic regimes and rising fertility in authoritarian regimes. Using several measures of growth, the empirical estimates from a large- n fixed-effects regression show that democracy conditions consumption so that the latter is associated with faster growth. Moreover, the empirical analysis indicates that government consumption in democratic regimes is associated with more education completion and lower fertility rates.