This paper seeks to provide an improved understanding of the origins of democracy. It begins by developing a theoretical model to demonstrate how exogenous economic conditions can influence both the incentives to establish democratic institutions and the likelihood that such institutions...

When a ruling elite is unable to commit to future growth-promoting policies, it may cede political power to a broader segment of the public, as in North and Weingast (1989). Alternatively, as we show in this paper, commitment may be achieved by moving in the opposite direction: installing a...