Self-Enforcing Democracy

If democracy is to have any of the good effects said to justify it, it must be self-enforcing. Those who control the government must choose to hold regular, competitive elections for the highest offices, and all parties must be willing to comply with the results. I consider simple models of electoral accountability along the lines of Barro (1973) and Ferejohn (1986), but allowing rulers to chose whether to hold elections and citizens whether to rebel or protest. When individuals privately observe a signal of government’s performance (e.g., their own welfare), they face a difficult problem of how to coordinate to pose a credible threat of rebellion necessary to induce the ruler to provide public goods. The convention of holding elections according to a known schedule and rules can provide a public signal for coordinating rebellion in the event that elections are suspended or blatantly rigged, while the elections themselves aggregate private observations of performance. Two threats to this solution to political moral hazard are also considered. First, when the ruling faction controls the army, it may prefer to fight rather step down after losing an election, and ex post transfers may be incredible. A party system where parties can return to office in the future is shown to be able to restore self-enforcing democracy, though at the expense of weaker electoral control. Second, subtle or piecemeal electoral fraud may undermine the ability of the citizens to credibly threaten the opposition that maintains elections. I show that when there are organizations in society that can privately (though noisily) observe and announce fraud or the state of popular discontent (such as an opposition party), under some conditions the incumbent prefers to commit to fair elections over an “accountable autocratic ” equilibrium in which public goods are provided but costly rebellions periodically occur. 1