I would guess that some of the welfare benefits of democracy and human rights both flow from and flow to greater economic prosperity, so holding those things constant may suppress some of the "true" effect.
Thanks for the good point, Ben. I think it is unclear whether democracy and human rights cause economic prosperity. I guess it depends on the context. In addition, democracy may cause economic prosperity due to favours from rich democratic nations instead of the institutional qualities of democracy per se, as argued in Democratic Favor Channel. Here is the abstract (emphasis mine):
A large body of literature in economics and political science examines the impact of democracy and political freedoms on various outcomes using cross-country comparisons. This paper explores the possibility that any positive impact of democracy observed in these studies might be attributed to powerful democratic nations, their allies, and international organizations treating democracies more favorably than nondemocracies, a concept I refer to as democratic favor channel. Firstly, after I control for being targeted by sanctions from G7 or the United Nations and having military confrontations and cooperation with the West, most of the positive effects of democracy on growth in cross-country panel regressions become insignificant or negatively significant. Secondly, using the same empirical specification as this literature for demonstrating intermediating forces, I show that getting sanctioned, militarily attacked, and not having defense cooperation with the West are plausible channels through which democracy causes growth. Lastly, in the pre-Soviet-collapse period, which coincides with the time when democracy promotion was less often used as a justification for sanctions, the impact of democracy on GDP per capita is already weak or negative without any additional controls, and it becomes further negative once democratic favor is controlled. These findings support the democratic favor channel and challenge the idea that the institutional qualities of democracy per se lead to desirable outcomes. The critique provided in this paper applies to the broader comparative institutions literature in social sciences and political philosophy.
Democracy and human rights are only associated with higher welfare holding income constant in some countries
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Summary
Holding real gross domestic product (real GDP) per capita constant, there is significant cross-country variation respecting whether more democracy and human rights are associated with a smaller/larger population size, life expectancy at birth, share of people who are satisfied with their life, and life satisfaction.
Introduction
People in more democratic countries tend to live longer, and countries where people live longer tend to have higher life satisfaction. I checked whether similar relationships hold within countries holding real GDP per capita constant.
The calculations and full results are in this sheet.
Democracy
World
Within-country linear regressions of the metric below on the Varieties of Democracy's electoral democracy index and logarithm of the real GDP per capita
Number of entities
Points per entity
Mean derivative with respect to the democracy index
Fraction of entities where more democracy is good
Population
172
55.0
5.46E+07
64.5 %
Life expectancy at birth
172
55.0
34.1
69.8 %
Share of people who are satisfied with their life
35
4.28
-1.71
37.1 %
Life satisfaction
160
9.97
-1.90
45.0 %
EU
Within-country linear regressions of the metric below on the Varieties of Democracy's electoral democracy index and logarithm of the real GDP per capita
Number of entities
Points per entity
Mean derivative with respect to the democracy index
Fraction of entities where more democracy is good
Population
27
51.2
-4.19E+06
25.9 %
Life expectancy at birth
27
51.2
13.8
77.8 %
Share of people who are satisfied with their life
27
24.0
-0.422
40.7 %
Life satisfaction
27
11.0
1.47
48.1 %
Human rights
World
Within-country linear regressions of the metric below on the civil liberties index and logarithm of the real GDP per capita
Number of entities
Points per entity
Mean derivative with respect to the human rights index
Fraction of entities where more human rights is good
Population
172
55.0
1.56E+07
62.2 %
Life expectancy at birth
172
55.0
8.55
63.4 %
Share of people who are satisfied with their life[1]
35
21.1
-2.20E+12
28.6 %
Life satisfaction
160
9.97
-0.331
42.5 %
EU
Within-country linear regressions of the metric below on the civil liberties index and logarithm of the real GDP per capita
Number of entities
Points per entity
Mean derivative with respect to the human rights index
Fraction of entities where more human rights is good
Population
27
51.2
-1.63E+07
14.8 %
Life expectancy at birth
27
51.2
-16.9
55.6 %
Share of people who are satisfied with their life
27
24.0
-2.69E+12
29.6 %
Life satisfaction
27
11.0
-2.27
33.3 %
Discussion
According to my results, holding real GDP per capita constant, a higher:
Varieties of Democracy’s electoral democracy index is associated with a:
Larger population size in 64.5 % of the countries globally, and 25.9 % of the countries in the EU. The mean effect across all countries is positive, and that across EU’s countries is negative.
Longer life expectancy at birth in 69.8 % of the countries globally, and 77.8 % of the countries in the EU. The mean effect across all countries is positive, and so is that across EU’s countries.
Larger share of people who are satisfied with their life in 37.1 % of the countries in Europe, and 40.7 % of the countries in the EU. The mean effect across Europe’s countries is negative, and so is that across EU’s countries.
Higher life satisfaction in 45.0 % of the countries globally, and 48.1 % of the countries in the EU. The mean effect across all countries is negative, and that across EU’s countries is positive.
Civil liberties index is associated with a:
Larger population size in 62.2 % of the countries globally, and 14.8 % of the countries in the EU. The mean effect across all countries is positive, and that across EU’s countries is negative.
Longer life expectancy at birth and population in 63.4 % of the countries globally, and 55.6 % of the countries in the EU. The mean effect across all countries is positive, and that across EU’s countries is negative.
Larger share of people who are satisfied with their life in 28.6 % of the countries in Europe, and 29.6 % of the countries in the EU. The mean effect across Europe’s countries is negative, and so is that across EU’s countries.
Longer life satisfaction in 42.5 % of the countries globally, and 33.3 % of the countries in the EU. The mean effect across all countries is negative, and so is that across EU’s countries.
These results suggest more democracy and human rights, holding real GDP per capita constant, are associated with higher welfare in a random country in the world, and lower welfare in a random country in the EU[2]. I expect the results to become less favourable to democracy and human rights after controlling for sanctions from and conflicts/cooperation with the West as done in Park 2024, although not much since I already controlled for real GDP per capita. In any case, I think the key takeaway is that there is significant cross-country variation, both globally and in the EU.
Across all countries excluding the regressions on the share of people satisfied with their life, which only respect Europe’s countries, 66.7 % (4 out) of the 6 mentioned mean effects are positive. Across EU’s countries, 25.0 % (2 out) of the 8 mentioned mean effects are positive. In contrast, 100 % (16 out) of the 16 mean effects with respect to the logarithm of the real GDP per capita are positive.
I would guess that some of the welfare benefits of democracy and human rights both flow from and flow to greater economic prosperity, so holding those things constant may suppress some of the "true" effect.
Thanks for the good point, Ben. I think it is unclear whether democracy and human rights cause economic prosperity. I guess it depends on the context. In addition, democracy may cause economic prosperity due to favours from rich democratic nations instead of the institutional qualities of democracy per se, as argued in Democratic Favor Channel. Here is the abstract (emphasis mine):