Democratic Institutions and Economic Development
Democratic institutions are political structures in which individuals have the right to rule, either indirectly by legislators or directly. On the other hand, the term economic growth refers to any things that aim to transform or boost people's economic condition as well as their way of life. According to studies, there is a clear association between political institutions and a country's economic development. According to the study, the development environment is decided by the peacefulness of a state and the cooperation of the government. As a result, it means that nondemocratic institutions are correlated with a low rate of growth. Therefore this paper is a discussion of whether democratic systems are suitable for economic development or not and the reasons behind its successfulness or failure.
Effect of Political Freedom on Economic Development
First and most important, the debate concerning social or political freedom relationship with the economic development of a county has been on for long. However, more of the scientist tend to support that freedom of such institutions tends to have an indirect contribution to economic development. It should be noted that the political systems that are crucial to economic growth are more likely to function and to exist efficiently in a democratic environment. As stated from various scientific studies, the legislative is mandated with the role of making and amending the law. No doubt that the rule of law protects property right. Therefore in a democratic institution where people rule directly or through representatives, they will be in a position to make law and policy that would work in one way or another their property right. Thus more citizens are likely to do what they can to invest in properties. On the other hand, such investments act as sources of revenue thereby promoting the economic development of a country. In addition to this, when the citizens owe properties such as land they are likely to engage in agricultural activities that in return leads to economic development.
Individual Liberty and Entrepreneurship
Furthermore, scholars associate democratic institutions with individual liberty which in one way or another fosters entrepreneurship and creativity. Whenever people are free from external restraints, they are likely to innovative and creative. For example, they innovate new technological devices to assist them in their day to day life. Moreover, they will have a thought of risking their finance in businesses in the hope of profit. It should be noted that such activities may lead a country at a far edge as far as economic development is concerned. For example, if they succeed in their innovation and entrepreneurship activities, they are likely to offer employment to members of the society and also contribute to the wellbeing of the means of communication and transport in their community. All such development is economic development thus there is no doubt that democratic institutions facilitate economic development.
Checks and Balances for Wealth and Public Properties
Furthermore, democratic institutions can be checked regularly and balance all the transactions. Such institutional checks and balance ensure that there is the total prevention of the massive theft of public properties and wealth. Contrary to non-democratic institutions there are established commissions that keep check and balances of the democratic institutions. It, therefore, implies that in an office where one gets to receipt for all the transactions clearly, then there is accountability. Thus there is minimal and sometimes no theft of public wealth. Instead of such wealth benefitting a single person or a company, it's used by the government to run a profit and income generating projects such as health centers and schools among others. Thus such wealth and indeed the democratic institutions promote the economic development of a country.
Freedom of Expression and Economic Development
Also, it's worth nothing to say that according to scholar's democratic institutions provide room for freedom of expression. A well-protected freedom of speech ensures that citizens have entitled to production right and as well the flow of information among the citizens. This further is associated with marketing and advertisement. For instance in a case where the citizens are entitled to rights to make publication and marketing of their businesses then they can quickly promote the demand for a particular community. On the other hand, an increase in demand for commodity leads to innovations and high profit whether directly or indirect thereby promoting economic advancement among the societies and in the whole nation in general.
It should be noted that through freedom of expression, people are likely to interact with others from foreign countries, in the process they may borrow ideas on how to improve their daily life. Such approaches may directly lead to the economic development of a nation or may indirectly lead to innovation, creativity, and entrepreneurship which are known to play a huge role as far as the economic development of a country is concerned.
Preservation of Traditional and Cultural Activities
Despite this, it should be noted that democratic institutions are associated with the well-being and a proper functioning of the society's traditional and cultural activities. Some of the communities are known for maintaining their culture such as trade and production of raw materials in agriculture. On the other side, the democratic institutions facilitate free participation and funding of such communities. Thus there will be a continued trend of raw material production and as well involvement in economic, social and political activities which in one way or another leads to a conducive environment for economic development. Therefore one can argue that the fact that communities have a setting to carry out their cultural and traditional activities plays a role in shaping the economic development of a country.
Drawbacks of Democratic Institutions
Nevertheless, some scientists associate democratic institutions with the collapsing of the economic activities of some states. The study shows that some of the citizen representatives in such democratic systems have a high tendency to consume the public wealth. As an attempt to win sympathy for a second term in the government and as well as an attempt to meet voters short-term demands some representatives may consume public wealth. Also, it should be noted that not every community can be accommodated in the government. Thus democratic institutions are associated with the marginalization of some societies.
Also, today's politics has changed to politics of tyranny of numbers where the community with the majority wins. Therefore, the marginalization of the minority creates a widening gap between the majority and the minority. It, therefore, implies that whenever the difference between the minority and the minority exists, most likely there will be reduced distribution of wealth thus hindering economic development in some areas.
However, over an extended period, the controversy between democratic and nondemocratic institutions has been a topic of discussion among scholars. Some scholars argue that the notion of democracy relationship with economic development does not work well in poor countries. It, however, tends to be true because researchers indicate that most of the governments in the developing countries are associated with corruption activities hence reduced economic growth rate. However, it should be noted that states with democratic institutions are related to good governance of which the rating concerning such developments is done by how the country is developing economically, socially and politically.
In Conclusion
It's evident that democratic institutions are vital to the long-term economic development of any state. Whether directly or indirectly, the fact remains that democratic institutions create a conducive environment for production and information rights, create room for innovation, creativity, and entrepreneurship. In addition to this, the rule of law which is provided by the institutions of law leads to economic development. Finally, the fact that the systems of code can be regularly checked is an excellent indicator to fight the representative's habit of consuming public wealth. Thus it's worth noting that despite the fact that democratic institutions are associated with some drawbacks, there are several advantages that emanate from such systems. Therefore, the 21st generation governments should not overlook these systems as they play a huge role in developing the country not only economically but also politically and socially. To my point of view, any democratic institution is in a position to promote the economic development of a country if only the representatives are not selfish and if such systems can be regularly checked. However, I call upon the researcher to dig deeper into this field to prove to the opponents of this argument that democratic institutions play a significant role in the economic development of the country. Thus we can comfortably say that any democratic system is directly or indirectly connected with the economics of any state.
