The Political Economy of Dictatorship.

• Author: CAPLAN, BRYAN
• Position: Review

The Political Economy of Dictatorship By Ronald Wintrobe Cambridge: Cambridge University Press, 1998. Pp. x, 390. (ISBN 0-521-58329-2)

It is much safer for an academic to write a flawless work on a picayune topic than to explore an interesting topic and make some mistakes along the way. In The Political Economy of Dictatorship, Ronald Wintrobe takes the latter, riskier route. Using an unabashedly economistic approach, he tries to explain how dictators stay in power, how political repression and economic performance interact, the nature of democratic inaction and nationalism, and how bureaucracies function.

Wintrobe begins with a formal model of autocracy, which specifies that dictators maximize a weighted average of power and personal consumption. At the poles, a dictator may be a pure power-maximizer (a "totalitarian") or a pure personal-consumption maximizer (a "tinpot"). Whatever their preferences, dictators must divide their resources between repressing opponents and rewarding loyal followers. That decision looks like a standard intermediate-microeconomics problem, but several factors complicate the analysis, especially imperfect information (a dictator's ability to repress opponents leads most of them to pose as supporters) and imperfect enforcement (neither the dictator, nor his loyalists, nor the general public can readily trust each other's promises).

Noneconomists will probably consider Wintrobe's formal model of the utility-maximizing dictator to be a long walk for a short drink. But his emphasis on imperfect information-and imperfect enforcement is more fruitful. In democracies, explains Wintrobe, people can express their preferences without fear of punishment, and they can retaliate at the ballot box against leaders who break their promises. These responses are hardly perfect solutions to the information and enforcement problems, but in dictatorships the situation is worse: people are often too afraid to say what they actually believe, and there is no easy way to punish a dictator who violates his pledges.

Dictators therefore place more emphasis on building networks of loyalty to compensate for the weakness of democratic enforcement mechanisms; they also tend to lash out at bonds of loyalty that allow other members of society to enforce agreements potentially at odds with the dictator's wishes. Thus, according to Wintrobe,

Stalin may have been extraordinarily ruthless, but he was not irrational if we look at the effects of the...