The simplest way to think of a postrevolutionary society is, therefore, one in which the citizens divide the resources of the economy. However, it is plausible that a violent event like a revolution creates significant turbulence and destruction and, consequently, reduces the productive capacity of the economy. So, let us think that after revolution, a fraction µ of the resources of the society are destroyed and the remainder can be divided among the citizens. This is clearly a simplification. Most revolutions do not act in such an egalitarian way by redistributing the resources of the postrevolutionary society only to the citizens. Some will invariably benefit more than others. Nevertheless, our purpose is not to develop a realistic theory of revolutions but rather to use the threat of revolution as a constraint on nondemocratic politics. For this reason, we again appeal to Occam’s razor and model payoffs in the postrevolutionary society in the simplest way possible. Assuming that some of the resources of the economy are destroyed in the turbulence of the revolution and the rest are distributed in some way among the citizens is both a simple and appealing formulation for this purpose.
This assumption implies that after the revolution, each citizen (here, a poor agent) receives a net income of:
(5.1)
because the total income they will divide among themselves is (1 - µ)and there are 1 - 8 of them. The notation VP(R, µ) denotes the value (i.e., utility) to the citizen in a postrevolutionary society conditional on µIgnoring the collective-action problems discussed later, we can see that the revolution will be beneficial when the payoff given in (5.1) is greater than the payoff a citizen receives without revolution. Let τN denote the tax rate set by the elites, where N denotes nondemocracy, and suppose that without revolution, the elites simply set their most preferred tax rate, r’ (= 0). Then, this payoff is:
(5.2)
We say that the revolution constraint binds if (5.1 ) is greater than (5.2), or if:
(5.3)
We write this constraint with a strict inequality because we assume that if (1 — µ)/(1 — δ) = yP, so that the citizens are indifferent between the political status quo and revolution, they do not revolt.13 We adhere to this convention throughout the book.
An important feature of this inequality is that it compares the payoff from revolution to the payoff from the status quo. This comparison is conceptually the correct one for either the group as a whole or a “pivotal” agent who, by his or her participation, determines whether the revolution will succeed. Either interpretation is adequate for what follows, although other possibilities are also discussed in the next subsection.
Recalling the definitions from Chapter 4 in (4.7), the revolution constraint in (5.3) is equivalent to:
(5.4)
Our model of revolution is simple; nevertheless, it has two plausible features that are important for our discussion. First, the revolution constraint (5.4) is more likely to bind when the society is more unequal - that is, when θ is high. This is intuitive. In a more unequal society, the citizens receive only a small fraction of the resources; with a revolution, they can take control of all productive capacity (minus what is destroyed in the process of the revolution). It is, therefore, natural that revolution becomes more attractive for the citizens in a more unequal society. Second, the revolution is more attractive when 1 — µ, the fraction of the output that remains to be distributed the postrevolutionary society, is high either for technological reasons or because the citizens have been able to successfully solve the collective-action problem.
2.3 Collective-Action Problems in Revolution
Before the revolution threat becomes a reality and, hence, before the revolution constraint becomes a constraint with which the elites have to deal, the citizens have to overcome the potential collective-action problems inherent in coordinating participation in revolutionary activity, The importance of collective-action problems in group decisions was highlighted by Olson (1965) in his classic book, The Logic of Collective Action, in which he analyzed the problems that groups have in convincing individuals to take actions that are costly for themselves but beneficial for the whole group. His analysis was applied to revolutions by Tullock (1971).
To see the potential collective-action problems in organizing a revolution, suppose, plausibly, that taking part in revolutionary activity or in the revolution itself is costly and denote this cost by εy. As usual, we normalize these costs by average income. This can include the actual cost of exerting effort for revolutionary activities, the implied costs posed by the danger of taking part in illegal activities, as well as costs of forfeited earnings due to the fact that revolutionary activities may replace working in the labor market. We first need to specify the circumstances under which a revolution attempt will succeed. Clearly, if none of the citizens take part in revolutionary activities, there will be no revolution. Suppose that we need at least a number ξ p <_ 1 — δ of the citizens to take part in revolutionary activities for them to succeed.
Now consider the payoff to an agent who has taken part in revolutionary activities. This is given by the postrevolution payoff minus the cost of revolution activities ; that is, (1 - µ)/ (1 - δ) - εif the revolution succeeds and by yP- εif the revolution fails. In contrast, the payoff of a citizen not taking part in revolutionary activities is (1 - µ)/ (1 - δ) or yP in these two cases. The benefits are the same because a revolution is a public good in the sense that when it occurs, it changes the entire society and affects all citizens in the same way. Hence, whatever the outcome, the payoff for not taking part is always greater than the payoff for taking part in a revolution. Therefore, all citizens prefer to free-ride on others’ revolutionary activities rather than incurring the costs themselves. The only obvious exception is when the agent making the decision between taking part and not taking part in revolutionary activities is “pivotal” in the sense that his or her participation would ensure or significantly increase the chance of success of the revolution and his or her nonparticipation would mean failure or a significantly reduced chance of success. Because there are numerous citizens, the action of a single one is typically not decisive for the outcome of the revolution. This introduces the famous collective-action or free-rider problem: no citizen should be willing to make the necessary investment in revolutionary activities and the threat of revolution will disappear.
The literature on the collective-action problem, including Olson’s (1965) The Logic of Collective Action, identified a number of ways that groups can attempt to deal with collective-action problems, including the use of ideology and pecuniary benefits. Pecuniary benefits, in turn, can be usefully disaggregated into two categories: private benefits and exclusion.
First, groups may try to indoctrinate their members so that they view participation in activities that are beneficial for the group as a positive action that directly adds to their utility. In the case of citizens trying to organize revolutionary activities, this might mean that in addition to the cost εcitizen i may view participation in revolutionary activities as bringing a nonpecuniary benefitIn this case, if the revolution succeeds, participation would have a payoff of (1 - µ)/(1 — δ) +- εto citizen i, whereas nonparticipation would yield ( 1 - µ)/(l - δ). Ifthe revolution fails, participation yields yP +- εwhereas nonparticipation gives γρ. Hence, there will be participation in revolutionary activities by all citizens for whom- ε > 0 and, if a critical mass of individuals derive sufficient ideological benefits, the revolution will take place. This type of indoctrination is clearly a common strategy by all revolutionary groups because, without it, revolutions typically do not succeed. We can then think of the leadership of a potential revolutionary group using this type of indoctrination when revolution is beneficial for the group as a whole - that is, when (5.3) holds.
Second, groups may attempt to generate private pecuniary benefits for those who participate in collective action. Consider first the strategy of providing private benefits to individuals, denoted by b who take part in collective action. As we discuss shortly, most re
al-world revolutionaries try to generate private benefits, monetary or otherwise, for taking part in revolutionary activities that the participants can keep, even if the revolution fails. In this case, the return for taking part in collective action when the revolution succeeds would be (1 — µ)/(1 — δ) + whereas that of not taking part would be (1 — µ)/(l — δ). When a revolution fails, the respective payoffs would be γρ+- εand yP. This implies that as long as b > ε collective action would be rational for agents receiving the private benefits. Once again, we can think that when collective action - for example, revolution - is more beneficial for the group as a whole, the leadership of the group is more willing to provide private benefits to a critical mass; thus, we may expect private benefits to also encourage revolutionary activities more when (5.3) holds.
In practice, the most common strategy to deal with collective-action problems is “exclusion.” Exclusion limits the benefits resulting from collective action to only those who take part in the action. The empirical literature illustrates the importance of exclusion in practice. For example, let the number of citizens taking part be ξ. Clearly, ξ 1 - δ because the total number of citizens is 1 — δ. Moreover, suppose that the revolution will succeed ifξξP. Assume that all citizens keep their own income whatever happens (including a successful revolution). In addition, if a revolution takes place, the income of the elites is distributed between all those who take part. In other words, each revolutionary agent will receive a total income of yP + (1 - µ)ξ as long as ξξp. Then, given that revolutionary activity has a cost of εthe revolution will take place as long as:
(5.5)
This condition implies that the maximum net gain from revolution should be greater than the cost of getting involved in revolutionary activities. The left-hand side is the maximum net gain because this is the gain to a citizen for taking part in revolution when the minimum number of agents necessary take part. Therefore, it maximizes the per-person gain. When condition (5.5) holds, there exists a revolutionary equilibrium with ξ> ξp agents taking part in revolution, and revolution succeeding,14 where is given by:
(5.6)
using the fact that yr = θ/θ. That ξ>ξp immediately follows from the fact that (5.5) holds and the fact that the left-hand side of (5.6) is decreasing in ξ.
In this case, in which collective-action problems are present but are being solved by exclusion, we can think of the revolution constraint as corresponding to equation (5.5), or:
(5.7)
The results of interest that come from (5.7) are similar to the case in which the relevant constraint is given by (5.4). For example, in both cases, an increase in inter-group inequality parameterized as a rise in θ will make the revolution constraint more likely to hold. In the remainder of the book, we work with the simpler condition, (5.4).
Notice also another implication of using exclusion to solve the collective-action problem. We can think that a greater ξ P corresponds to a more severe collective-action problem because more citizens need to participate in revolution for it to succeed and, therefore, more individuals need to be convinced to act for the group. In terms of the more reduced-form condition in (5.4), this is similar to a higher µ. Therefore, we loosely talk of the level of µ reflecting both technological factors, related to how much of the productive capacity of the economy the citizens can make use of in a postrevolutionary society, and the severity of the collective-action problem.
Finally, the presence of the collective-action problem in revolution implies that the revolution constraint will not always be binding. It might be that the citizens are able to solve the collective-action problem during some periods but not others. Later, when we consider dynamic models, this is one of the sources of transitory political power for citizens in nondemocracy.
2.4 Evidence on the Collective-Action Problem
A rich empirical literature has investigated how the collective-action problem is solved in practice (e.g., the surveys in Lichbach 1995 and Moore 1995). Although there are different ways of classifying putative solutions to the collective-action problem (Lichbach 1995, pp. 20-1), most scholars emphasize, as we have done, the importance of ideology. Nevertheless, most of the empirical evidence is more about how private benefits and exclusion are used by those trying to organize collective action.
Popkin (1979) provides a seminal account of the solution to the collective-action problem in the Vietnamese revolution. He argues that “The problem of building support and overcoming free riders was ... central to Viet Minh strategy” (p. 223). Their main tool was to break down large problems, such as mounting a revolution, into many small problems where individuals could see how their contribution was important and where each benefited directly. Popkin (1979, p. 262) argues, “one consideration in particular may have been crucial for effective mobilization of the peasantry ... the initial organization of peasants focused on local goals and goods with immediate payoffs.” This is similar to our model in which individuals get a private benefit ofirrespective of the outcome of the action. When the Communists took over villages, they aimed at selectively providing what peasants wanted, such as land, in exchange for their participation. “Even when an organization produces divisible goods for individual consumption, there are collective goods aspects to the organization itself... it is possible to produce benefits for the peasants as well as a ‘revolutionary surplus’ which can then be used to support a supra-village organization and applied to broader organizational goals.” An illustration of how this worked is given in Popkin (1979, p. 257):
After land was redistributed and rents reduced in Cochinchina, peasants commonly went out of their way to warn Viet Minh cadres that French soldiers or agents were in the area; they did not risk free riding on warnings by waiting for someone else to notify the cadre.
Thus, once the Communist Party had framed the issues in the right way and used selective incentives, individuals found it rational to engage in collective action. For example, Popkin notes that even though giving out land to peasants as private property was against the philosophical commitments of the Communists because they favored communal ownership and collective farms, they nevertheless gave land to peasants who cooperated with the revolution. He quotes a senior Communist official as saying
... the system [private property] is far from perfect.... However, we have been obliged to stick to it because our entire political action among the peasants is based upon the right of each to individual property. We would have risked losing their support had we stopped breaking up landholdings. (p. 241)
The fact that one goal of the revolution was radical land reform and that land could be redistributed to those who took part and withheld from those who did not allowed the Viet Minh to use the strategy of exclusion to encourage people to take part in collective action.
Part of the strategy of the Viet Minh for solving the collective-action problem was also to exploit existing social networks and community institutions: “The Communists were forming small self-help fraternal organizations, one-fourth of whose members had been political prisoners. These organizations were built around friendship associations, groups to build straw huts, associations to celebrate the cult of the genii, and insurance systems” (Popkin 1979, p. 230; see also Woodside 1976, p. 179).
Several other informative case studies show the power of selective incentives in sustaining collective action. Kriger (1992) showed how participation in Zimbabwe’s revolutionary war was driven by the expectation of personal gain. She interviewed people who had been members of Zimbabwe African National Union (ZANU) guerillas and found that they joined because they expected personal gain and, in particular, they expected to enhance their status within their local community. High-status people had to be coerced into joining ZANU.
The effectiveness of private benefits in stimulating collective action is graphically illustrated by evidence from the Rwandan genocide. In the comprehensive study by Human Rights Watch under the chief authorship of historian Alison Des Forges, there are many e
xamples of how the Hutu political elite solved the collective-action problem inherent in mobilizing the Hutu population to massacre Tutsis. For instance,
they (the Burgomasters) directed or permitted communal police, militia, or simply other citizens to burn down houses and to threaten the lives of those who refused to join in the violence. They also offered powerful incentives to draw the hesitant into killing. They or others solicited by them provided cash payments, food, drink and, in some cases, marijuana to assailants. They encouraged the looting of Tutsi property, even to the point of having the pillage supervised by the communal police.... In several places police reprimanded the people who wanted only to pillage and not to kill.... One of the most important resources for the burgomaster in enlisting participants was his authority to control the distribution of land, a much desired and scarce source of wealth for the largely agricultural population. Hutu who had attacked Tutsi in the 1960’s had acquired the field of their victims. A generation later, people again hoped to get more land by killing or driving Tutsi away. (Des Forges 1999, pp. 236-7)
Figure 5.1. Constraints in Nondemocracy.
No doubt, it is also true in the Rwandan case that ideology was important and the long-running animosity between the Hutu and Tutsi ethnic groups played an important role in the conflict. This evidence also suggests that another type of selective incentives - negative sanctions against those who failed to take part in the genocide - were also useful.
Economic Origins of Dictatorship and Democracy Page 19
