In this post I will investigate the
impact of remittances on the endurance of non-democratic regimes and the
survival of autocratic elites. I will look in particular on whether remittances
can influence the prospects of democratization in states with transitory
political systems. For this purpose I will brush through the literature that
assesses the prospects of the incumbent elites’ to preserve power in
remittance-receiving societies using the political patronage resource.
Before analyzing the impact of economic
remittances let us explain in few words what is political patronage. The
main assumption of the patronage theory
is that nondemocratic elites cannot solely rely on undisguised force to stay in
power since this type of governance is extremely costly to be maintained. That
is why the majority of nondemocratic regimes prefer to preserve elements of
procedural democracy that help them legitimize their rule. Organized elections
are less competitive since a large part of the population is dependent on the
elites. They maintain with the elites an established patronage and clientelist relation.
To maintain these “preferential” relationships, elites buy allegiance from
their direct supporters by offering them access to different spoils of power.
In the same time, elites provide access to public goods for those who passively
accept their mastership.
Three essential elements are considered in
this analysis of the effects of remittances on the endurance of nondemocratic
regimes. First, the power of nondemocratic regimes is contingent upon the size
of their supporting coalition (Bueno de Mesquita et al., 2003). Second element
is the size of the assembly from which privileged supporters are selected
(Geddes, 1999). Last one is the size of power elites’ opponents. This latter
element is important since the consent of power opponents represents the cost
elites should pay in forms of policy concessions and access to public goods in
order to stay in power (Gandhi, 2008). Remittances, in this state of affairs,
change actors’ preferences by revising their individual bargaining power.
Finally, the influx of remittances changes economic and political preferences
of the different domestic groups. This change transforms the popular levied
support previously conveyed to power elites. A good illustration is the
Escriba-Folch (2013) analysis of 137 autocracies in 91 countries in the period
of 1975-2009 who finds that remittances destabilize autocratic regimes by
reducing citizens’ dependence on government spoils. Consequently, he concludes
that remittances undermine the survival of autocratic elites. By increasing the
levels of private revenues spent mainly on consumption, remittances lower the
perceived value of state-provided public goods and services. By offering
individuals and households an exit option from the regime’s patronage network,
remittances hence break the existing clientelist link between voters and
incumbent elites.
This conclusion is however conditional
upon a set of conditions. First,
power elites should hold multiparty elections regularly. Elections as a method
of legitimation are very frequent in autocracies (Hyde & Marinov, 2012;
Gandhi & Lust-Okar, 2009). Second, the political system should be organized in such a
manner to governed by a dominant political party. According to Geddes, (2003)
party-based autocratic regimes were the most commonly met forms of autocracies
in the last six decades. That is because dominant party regimes are inclined to
have larger support coalitions than other regime types. In this case, power
elites rely on broad-based distribution of goods to obtain allegiance from
large winning coalitions by deterring the general public from investing in the
opposition. That is why the survival of these types of regimes depends not only
on the elites’ capacity to provide their direct supporters with goods and
services – patronage (Gandhi, 2008), but also on the delivery of public goods
to larger segments of the population – clientelism (Bueno de Mesquita et al.,
2003; Malesky et al., 2011; Magaloni, 2006; Greene, 2007; Pepinsky, 2007).
To explain the working mechanism under
these first two conditions, Greene (2010) clarifies that clientelist systems
with a dominant party can be established only through politicization of public resources/public
services. The party control over state assets opens the possibility for the
elites to control and distribute the access to housing, social services,
property, agricultural allowances, subsidies and pensions, education,
transportation cost, fuel supply, access to jobs or prices of food. Incumbents
in this manner secure their positions as public services become accessible only
in exchange for regime support. This politicization of public services makes
large portions of society be economically dependent on the services provided by
the incumbent elites (Magaloni & Kricheli, 2010). For instance, public
housing programs promoted by the ruling People's Action Party in Singapore
represented a key source of support and votes for the party since 1960. The most
common forms of hooking allegiance were to distribute different types of goods
or money in the pre-electoral period. For instance, during elections in
Malaysia, the ruling party staff visited rural households to distribute cash
payments to supporters (Pepinsky, 2007, p. 144). During presidential elections
in Romania in 2014 the ruling party distributed wristwatches and clothes. The
Communist Party in Moldova distributed in 2004 and 2008 elections potatoes,
rice, pasta and sugar. In Ukraine and Moldova the parties also offered theatre,
circus and concert tickets for free, not to mention that an outstanding
practice is to invite pop-stars to perform during electoral shows in support of
the incumbent party. A more recent development of political clientilistic
relationship in Moldova is to buy people elegance by offering the poor part of
the electorate Christmas gifts coming from incumbent elites personal
foundations. For instance the president’ wife runs “From Soul” foundation and
the leader of Democrat Party – the “Edelweiss” foundation.
The incumbent can also use coercive
methods. Blaydes (2010) shows that during Mubarak's rule in Egypt, areas that
opposed the ruling party saw almost no development in sewerage and water
providing infrastructure between 1980s and 1990s. A rule of thumb was
established since independence in Ukraine: the elected president and his party
would represent only the Eastern or Western part of Ukraine thus neglecting
almost entirely the development of the other region from which he would have
little support. Moreover, under PRI rule in Mexico, PRONASOL funds, consisting
of public works where deployed in those municipalities, which managed to ensure
the voters’ loyalty (Magaloni, 2006). In Moldova the same can be observed
regarding borrowed funds distribution. For instance the FISM (The Fund for
Social Investment from Moldova) whose budget is predominantly made out of
foreign grants is in charge to implement major infrastructural projects in
Moldova. Upon analysis it is seen that the benefiting communities are exactly
those whose mayors are members of the party that dominates the political
landscape.
The third condition described by Green
refers to remittances. He claims that them must increase the household
consumption to replace the amount and quality of public services provided by
the regime (Fajnzylber & Lopez 2007; Chami et al., 2008). Adida and Girod
(2010), for instance, show that remittances in Mexico were extensively used to
replace the previously provided public services, such as sanitation and clean
water. Chaudhry (1989) presents a similar situation in Yemen where during the
1970s, local cooperatives used the remittances they received from abroad to
finance road reconstruction, schools and clinics constructions, as well as develop
farming projects. In Moldova remittances are massively used to access private
medical service by bypassing the public health sector that is offered only to
preferential groups. Remittances hence provide households with an exit from the
regime's patronage network (Ahmed, 2011; Diaz-Cayeros et al., 2003; Pfutze,
2014).
Fourth, to be able to exit the patronage
trap, the voters should not care exclusively about material benefits. They need
also to have ideological preferences. It is true that ideology is pushed aside
when deprivation level is unbearable. That is why the poorer the voters the
easier they can be trapped into clientelist regimes. Assuming that the
provision of public services is the price the regime pays for buying support in
clientelist regimes, the higher the state of general social deprivation, the
lower the price elites must pay for this support. Consequently, with increased
household revenue received from remittances, voters pursue first their
ideological preferences (Merino, 2005). The theory is supported by empirical
studies carried out in a number of municipalities in Mexico (Diaz-Cayeros et
al., 2003; Pfutze, 2014) where remittances from migration have proved to
empower non-incumbent parties. Ahmed (2011) confirms that these results are
valid for the majority of Latin American countries. The last condition
identified by Escriba-Folch (2013) is for power elites to have limited
resources to pay for voters’ allegiance. In this sense, the available resources
to be used for subsidized public services should not overbid the transfers
coming from emigrants.
The main argument refuting
the patronage explanation of the beneficial role of remittances is that
domestic elites can also control or influence the flux of remittances entering
the country. Oftentimes they can use the remittances flows to those directions
that would empower their own positions. Some studies show how policymakers
managed to compile specific politico-economic projects to channel the flow of
remittances and to manage how these are being used (Spector & de Graauw,
2006; Meseguer & Aparicio, 2012). Meseguer and Aparicio (2012) investigated
government projects in Mexico that were meant to match 3-to-1 the amount or
‘remidollars’ sent by Mexican emigrants through the existing hometown
associations. A similar project in Moldova called “Pare” is run by BRD
(Government Bureau in charge for the Relationship with Diaspora) that channels
the emigrant’s money into the local investment projects. The study shows that, in
case of Mexico, the matching of government support for public infrastructure
projects was granted predominantly to municipalities that supported the
incumbents. The municipalities that experienced higher political competition
received less support. This is just one of the ways how governments can repay
incumbent supporting communities and penalize those that support opposition
candidates.
This post analyzes to what
extent can economic remittances received from abroad can autonomies the local population
political chose, and spoil the allegiance type of relationship built by the
incumbent autocratic elites.
No conclusion…
Bibliography will be uploaded it by request.
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