The Democratic Advantage

By Ann Bernstein

Democracy won. The Wall fell. Freedom triumphed. Then we blinked and political paralysis, a global financial crisis, economic downgrades and defaults shook our faith. China's pragmatic but authoritarian model for rapid growth took on a new sheen.

In a world of contested ideas about approaches to governance and development should the future of the developing world be one dominated by authoritarian governments? Are autocracies the best means of producing economic growth and inclusion for the vast majority of the world's population? Analysis of three democracies in the South, a geographic hemisphere often omitted by those asking these questions, suggests the answer is a resounding ‘no.'

The experiences of Brazil, India and South Africa demonstrate that it is not necessary to give up individual freedoms, rule of law, independent institutions, a free press and regular elections in nations struggling with the challenges of poverty. On the contrary, democratic rights and freedoms can in numerous ways help promote sustained development, higher economic growth and effective routes out of poverty.

In countries with large populations, low levels of education and rapidly expanding cities, the nature of economic growth matters just as much as the rate. Growth in a developing country must be sustained and labor-intensive. It must produce the higher state revenues necessary to expand basic services, education and health opportunities for those historically excluded from the modern economy. These countries must open up to large companies, and also remove barriers to small and medium enterprise, secure property rights and open new opportunities for entrepreneurs.

South Africa's democracy has improved the quality of life for millions of people in ways that were unimaginable under apartheid. Brazilian poverty is now in single digits. In India, the size of the economy doubled between 2005 and 2012, with, by some calculations, nearly 190 million people lifted out of absolute poverty during this period.

All three countries have flexible political systems that provide them with the ability to renew themselves, deal with challenges and learn from mistakes. Many outsiders see protests in these developing nations as a sign of instability, but more often than not it is a way for citizens within these democratic developing countries to push for reform, not revolution. In exercising their democratic right to dissent they can strengthen the country and its political system, and sometimes open the way to better policy-making in future.

And the costs of unaccountability and corruption are high: they act as a curb on economic growth, destroy trust in the political system and government, erode the rule of law and weaken state institutions. The on-going battle against corruption ultimately requires more transparency, more effective democratic institutions and more representative democracy, not less. It is hard to see how authoritarian states can compete with this.

We also know a lot more about corruption in democratic societies than we do in authoritarian states, thanks to the efforts of citizens, NGOs, legislatures, state institutions and the media. This does not mean that corruption is more prevalent in democratic regimes; on the contrary, democracies provide more opportunities for people and institutions to talk about corruption, expose its prevalence and fight for improvements.

Democratic freedoms can also help foster economic and social innovation that authoritarian systems find it difficult to produce. By protecting dissenters from persecution, creating independent universities, entrenching intellectual property rights and freeing up the business environment, democracies can encourage and protect innovators from all walks of life with radically new ideas. Developing world democracies have proven good at social innovation. Their companies have proven to be particularly good at frugal innovation, and at producing, marketing and making money in developing world markets.

By intensifying transparency and accountability, championing further market reforms, strengthening the competence and capacity of their governments and committing to policies that expand opportunities for the poor, these three democracies offer different models -- and lessons in what works and doesn't work -- to tackle the challenges developing countries share.

The additional democratic advantage to fight corruption, fix mistakes, forge lasting national identities, promote inclusion and foster innovation make a compelling argument for a democratic alternative emerging from the pivotal countries of South. India, Brazil and South Africa.

Ann Bernstein heads the Centre for Development and Enterprise in South Africa.

(AP Photo)

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