STATE CAPACITY, DEMOCRATIZATION AND THE PROBLEM OF SEQUENCING
Andrei Melville
National Research University Higher School of Economics, Moscow
(amelville@hse.ru)
Introduction
The state and stateness as prerequisite for democracy and democratization is commonplace in
comparative politics literature (Rustow 1970; Tilly 2007; Linz and Stepan 1996; Fukuyama
2004, 2007; Mansfield and Snyder 2007; Moller and Skaaning 2011, etc.). This assumption leads
to important theoretical and practical implications, including the so-called sequencing argument,
which suggests that an effective state must come first, followed by democratization later.
But in what sense are state and stateness prerequisites to democracy and democratization? States
are not alike, in the real political world there are different types of states with different
evolutionary stages, resources, capacities, priorities, and political regimes. Are there any types of
states that are particularly disposed to further democratization? This problem of sequencing is of
special importance for transitional states of the “third wave” that face the simultaneous
challenges of state-building, nation-formation, economic reforms and regime transformation.
Can state building and democratization complement each other instead? Can democratization
start and be successful at low and medium levels of state capacity?
This paper starts with an overview of the extant literature and continues with the formulation of
several hypotheses. The methodology and the data set are further discussed. Various
relationships between levels of state capacity and trajectories of regime change (democratization)
are explored. Some preliminary conclusions follow.
Literature
Extant literature dealing with the abovementioned problems is enormous indeed. The basic
mainstream argument is, put simply, as follows: No state, no democracy. This basic argument
seems to be theoretically and empirically unquestionable. There is hardly any doubt that
democracy assumes a capable state and cannot exist in a vacuum of stateness. However, recent
debates have outlined different and alternative approaches to various forms of relationships
1
between types and levels of stateness and regime change, including the problem of sequencing.
Several approaches in the literature can be identified:
(1) “Stateness First”
This powerful argument advances the mainstream logic: high levels of state capacity (availability
of necessary resources and effective institutions) are necessary prerequisites for democracy and
indispensible preconditions for successful democratization (Back and Hadenius 2008, Moller and
Skaaning 2011, etc.).
(2) “Democratization without a State”
This is a logically possible but practically and substantially almost untenable hypothesis. Tansey
(2007 and 2009) gives only few examples, which look dubious: Kosovo and East Timor.
Scheuerman (2009) refers to globalization and transnationalization as factors that may eventually
decrease the relevance of sovereign stateness to democratization. In any case, this is a pretty
marginal argument in the literature.
(3) “Democratization Backwards”
Some authors point at historical (“classical”) regularity in European state-building starting from
at least the 16th century – and even earlier. The argument is that “modern” states (“born in
blood”) appeared first, and democratic practices and institutions came about gradually later.
Other authors, though, question the universal character of such regularity within the context of
the last decades of the “third wave” and argue for so-called “democratization backwards”, i.e.
parallel and complimentary to the processes of state building in new transitional states. Rose and
Shin (2001) provide empirical grounds to the thesis of the possibility of “Building the Ship of
State at Sea”, i.e. building new institutions of democratic governance in transitional states of the
“third wave” (thus bypassing the preliminary phase of building institutions of effective
authoritarian governance). Bratton (2004), Bratton and Chang (2006) and Carbone and Memoli
(2012), come to similar conclusions using different methodologies. Fortin (2011) underlines the
problem of endogeneity in the issues under consideration and, since the direction of causality
remains unclear, tends toward the conclusion that state-building and democratization may
complement each other.
Important issues, however, remain undisclosed. For example, some authors raise the problem of
a minimal threshold of stateness, understood as effectiveness of governmental institutions, which
2
is indispensable for the beginning of democratization (Capelli 2008, Hanson 2011, Fortin 2011).
This important problem is formulated in the literature, though adequate theoretical and empirical
arguments are largely insufficient.
Further, Grzymala-Busse and Luong (2002) notice that attention should be paid to multiple
authority centers during post-communist state-building and warn against “anthropomorphic
conceptualization” of the transitional state as a monolithic entity. Another quite important issue
has to do with the stability or variability of state capacity within the context of post-Communist
transformations. Fortin (2010), for example, argues in favor of relative invariability of state
capacity over time. This is an important question since, in the instance that this is accurate, we
would need to control for quite different (“non-stateness”, “non-state capacity”) variables in the
comparative analysis of post-communist transformations.
Finally, among the propositions most widespread in literature the J-curve is quite notable. Its
theoretical grounds may be found, for example, in Tilly’s (2007: 16-19) classification of “crude
regime types” along two axes (state capacity and democracy): high-capacity/undemocratic
(example
–
Kazakhstan);
low-capacity
undemocratic
(example
–
Somalia);
high-
capacity/democratic (example – Norway) and low-capacity/democratic (example – Jamaica).
Tilly’s theoretical proposition seems to be confirmed by empirical research (Back and Hadenius
2008; Charron and Lapuente 2010; Fortin 2011; Moller and Skaaning 2011, etc.). The argument
is the following: the highest levels of state capacity are attained in developed democracies, but
its substantially high levels can be found in autocracies and they are much higher than those in
transitional regimes. In a way, this is an argument in favor of the “Stateness First” approach in
the “sequencing” debate.
One may go on with this reasoning and presume that there is certain logic in the sequencing of
reforms and changes in countries undergoing transitions. It implies a priority of building a
strong1 state and strengthening the “vertical of power” eventually followed by democratization
which otherwise is fraught with the risk of losing control, chaos and even collapse of a state. If
this is true, then one of the major problems of the democratic transition is how to get through this
“danger zone” as the political and economic reforms may contribute to the deterioration of socio-
1
However, the concept of a strong state (in opposition to a weal state) frequently used in the literature, is rather
dubious. It is not always clear what the sources of this strength are. Do they result from an opposition’s weakness,
opportunities and monopoly to carry out repressions by the executive, lack of activity of the society, control of the
media and so forth? This question is not entirely theoretical. It is quite practical as is directly linked to the argument
in favor of authoritarian modernization in post-communist (rather – post-Soviet) states.
3
economic situation, degradation of governance and growing discontent among large groups of
population that do not gain anything from the reforms.
Hypotheses
The review of existing theoretical and empirical literature leads us to the following hypotheses,
which are further addressed in this paper:
H 1. Contrary to the mainstream in literature, high levels of state capacity are not always
indispensable prerequisites for democratization. Democratization may start and proceed at relatively
low levels of state capacity, although democratic consolidation occurs at its high levels. Postcommunist democratization and state-building (enhancement of state capacity) may complement
each other.
H 2. Despite the mainstream generic argument in the existing literature, post-communist nondemocracies do not demonstrate higher levels of state capacity and institutional quality than
transitional and hybrid regimes.
H 3. Levels of state capacity may change considerably during periods of radical social and political
post-communist transformations.
Data and methodology
This paper concentrates on post-communist countries from the beginning of the Velvet
Revolutions (1989) up to 2010. The sample consists of 27 countries, including Albania,
Armenia, Azerbaijan, Belarus, Bulgaria, Croatia, Czech Republic, Estonia, Georgia, Hungary,
Kazakhstan, Kyrgyz Republic, Latvia, Lithuania, Macedonia, Moldova, Mongolia, Poland,
Romania, Russia, Serbia, Slovak Republic, Slovenia, Tajikistan, Turkmenistan, Ukraine, and
Uzbekistan.
To proceed with the analysis, state capacity needs to be defined in a measurable way with
accessible empirical proxies. However, state capacity is a rather vague notion with no widely
recognized definition yet. The literature on modern states, stateness, and state capacity is
immense, but commonly accepted notions and definitions are still debatable.
For example, Fukuyama (2004) defines multiple dimensions of stateness, including functions,
capabilities, and grounds for legitimacy of government. He suggests a list of state functions,
including defense, law and order, property rights, protection of the poor, macroeconomic
4
management,
public
health,
education,
financial
regulation,
redistributive
pensions,
environmental protection, unemployment insurance, asset redistribution, and fostering markets
and cluster initiatives. Another approach is that of Baeck and Hadenius (2008) who consider
stateness as the capacity of state entities to maintain sovereignty. A more detailed focus is taken
by Hendrix (2010) via defining state capacity in terms of military capacity, bureaucratic or
administrative capacity, and the quality and coherence of political institutions. An institutional
approach is found in Fortin (2010) with state capacity measured by five indicators, which are
corruption, contract intensive money, infrastructure reform, protection of property rights, and tax
revenue. Another understanding of state capacity is presented by Charron and Lapuente (2010)
and Charron and Lapuente (2011) who equate state capacity with the quality of government
(measured by indicators of ICRG and WGI). Thompson (2014) considers state capacity as “state
strength” which is measured by indicators reflecting state fiscal capacity (income tax revenue as
a proportion of gross domestic product), state coercive capacity (coercive capacity scale),
legitimacy (“voice and accountability”, “government effectiveness”, “rule of law” and “control
of corruption, WGI) and armed force monopoly (“political stability”, WGI).
While some of these approaches to measurement of state capacity are merely theoretical and are
not supported by corresponding set of empirical indicators, others are more empirically oriented.
However, measurement of state capacity in post-communist countries remains a challenging task
provided poor empirical base. Quality and diversity of accessible statistical data for numerous
post-communist countries are pretty low. This implies both lots of missing data and dubious
pieces of data.
The mainstream literature understands state capacity as a combination of two major components:
(a) resources and (b) institutions. However, attempts to empirically measure these components
run into several methodological problems. The first one is how to measure available resources.
In some cases GDP per capita is used as criteria, although it certainly may be related not only to
state capacity but to other variables. Gehlbach (2008), as well as other authors, for example,
suggests levels of tax extraction as a measure of resources in defining state capacity. This would
seem an appealing approach; however, we need to take into account that tax share of GDP may
reflect the structure of the national economy, rather than the extractive capacity of the state – in
particular when dealing with resource oriented economies and their political preferences and
institutions. Besides, available data on tax structure in post-communist countries is missing in
some important cases and does not give us sufficient indicators of the percentage of taxes in
GDP. The second problem has to do with measures of institutions and institutional quality. One
5
may choose between combinations of variables of the WGI or ICRG and other analytical
instruments – again facing the problem of the missing data within the post-communist sample.
These are serious methodological problems which require further attention (however, beyond the
scope of this paper).
Taking these considerations and limitations into account, this paper attempts to measure postcommunist state capacity using GDP per capita as criteria of available resources. To measure the
quality of economic/financial and political institutions two variables are used: the Contract
Intensive Money index (which reflects quality of financial institutions and in some degree
people’s trust in national bank system) and the Physical Integrity Rights index from Cingranelli–
Richards dataset (as a reflection of the rule of law, irrespective of the characteristics of the
political regime). Democracy/autocracy as another key variable in this paper is measured by an
average of two indices – Polity IV and Freedom House2.
Analysis
Two scatterplots with data on democracy/autocracy and state capacity in post-communist
countries during two periods – from the beginning of the transition in 1989-1993 till 2006-2010
– are overlapped (Figure 1) in order to present rough trajectories of the dynamic of 27 postcommunist countries. This data can be used to test the three hypotheses presented above. In
particular, it affords to make several conclusions about state capacity and regime change in postcommunist countries related to the problem of sequencing.
Figure 1
2
This approach was previously developed and tested in collaboration with Denis Stukal (see Melville and Stukal
2012 and Melville, Stukal and Mironyuk 2014) and may be reassessed in further research.
6
First, countries with relatively high levels of state capacity are leaders in democratization (as of
2006-2010). These are Slovenia, Czech Republic, Slovakia, Hungary, Poland, Lithuania,
Estonia, Poland, etc. However, there are dramatic anomalies – countries which managed (for
various reasons) to more or less successfully democratize staring from relatively low levels of
state capacity – Croatia, Serbia, Georgia, Moldova. These cases prove that in particular
circumstances (yet to be analyzed) democratization may start without effective stateness and
state capacity, which at least partly confirms Hypothesis 1. However, it is important to note that
in these cases relatively low levels of state capacity are nonetheless on the average somewhat
higher than in most of autocracies which did not democratize. In principle, this may reinforce the
abovementioned argument about the minimal threshold of stateness and state capacity necessary
for the start of democratization.
Second, one common trend of the two decades of post-communist transformations is gradual
increase of state capacity, regardless of regime characteristics, There are again exceptions, such
as Ukraine or the Czech Republic which have advanced during the period analyzed on
democracy score but not in state capacity, or Armenia, Uzbekistan and Russia, which have fallen
7
(although to different degrees) both in the indices of state capacity and democracy. Apparently,
different factors may have impact on these dynamics, including the growth of the GDP without
the improvement of the quality of institutions.
Third, despite some very marginal increases in state capacity in authoritarian Kazakhstan and
even to a lesser extent in Azerbaijan and Belarus, two decades of post-communist
transformations did not result in the emergence of autocracies with high levels of state capacity.
These findings support Hypothesis 23.
Fourth, these findings indicate that levels of state capacity may actually change, and sometimes
quite substantially, during periods of radical political and socio-economic transformations. The
overall effect of successful post-communist democratizations is correlated with gradual increases
in state capacity and quality of institutions, although of very different degrees, which supports
Hypothesis 3.
These empirical findings, which confirm our hypothesis, but may not be in tune with some
important premises in existing literature, call for further research.
Conclusions
This paper contributes to the discussion of the “sequencing” problem by suggesting empirical
evidence in favor of possible complementarity of state (re-) building and democratization and
against the universality of “State First” approach. It further demonstrates that the J-curve
argument is not confirmed in case of the post-communist sample. Post-communist (or rather –
post-Soviet) autocracies successfully withstand democratization and do not produce high levels
of state capacity and quality of institutions. Moreover, some post-Soviet hybrid and transitional
regimes demonstrate higher state capacity and better governance than autocracies.
References
3
It should be noted that relatively low levels of state capacity, compared with the leaders of democratization, do not
mean that post-communist autocracies lack resources for extensive economic development (in contrast, the majority
of them are rich in natural resources, however, the proceeds of their export are distributed very unequally) or
repressive capabilities. They may have both. However, the quality of their institutions does not improve.
8
Baeck, Hanna and Axel Hadenius (2008) Democracy and State Capacity: Explaining a J-Shaped
Relationship. Governance: An International Journal of Policy, Administration, and
Institutions 21(1): 1-24.
Bratton Michael (2004) State Building and Democratization in Sub-Saharan Africa: Forwards,
Backwards, or Together? Afrobarometer Working Papers, no 43.
Bratton, Michael and Eric Chang (2006) State Building and Democratization in Sub-Saharan
Africa: Forwards, Backwards, or Together? Comparative Political Science 39(9): 10591083.
Capelli, Ottorino (2008) Pre-Modern State-Building in Post-Soviet Russia. Journal of
Communist Studies and Transition Politics 24(4): 531-572.
Carbone, Giovanne and Vincenzo Memoli (2012) Does Democracy Foster State Consolidation?
A
Panel
Analysis
of
the
“Backwards
Hypothesis”
(http://www.sociol.unimi.it/papers/2012-0419_G.%20Carbone%20e%20V.%20Memoli.pdf).
Charron, Nicholas and Victor Lapuente (2010) Does Democracy Produce Quality of
Government? European Journal of Political Research 49(4): 443-470.
Charron, Nicholas and Victor Lapuente (2011) Which Dictators Produce Quality of
Government? Studies of Comparative International Development 46(4): 397-423.
Fortin, Jessica (2010) A Tool to Evaluate State Capacity in Post-Communist Countries.
European Journal of Political Research 49(5): 654-686.
Fortin, Jessica (2011) Is There a Necessary Condition for Democracy? The Role of State
Capacity in Post-Communist Countries. Comparative Political Studies 45(7): 903-930.
Fukuyama, Francis (2004) The Imperative of State-Building Journal of Democracy 15(2): 17-31.
Fukuyama, Francis (2007) Liberalism versus State-Building Journal of Democracy 18(3): 10-13.
Gehlbach, Scott (2008) Representation Through Taxation: Revenue, Politics, and Development
in Postcommunist States. Cambridge: Cambridge University Press.
Grzymala-Busse, Anna and Pauline Jones Luong (2002) Reconceptualizing the State: Lessons
from Post-Communism Politics and Society 30(4): 529-554.
Hanson, Jonathan (2012) Democracy and State Capacity: Complements or Substitutes?
(http://faculty.maxwell.syr.edu/johanson/papers/hanson08.pdf).
9
Hendrix, Cullen S. (2010) Measuring State Capacity: Theoretical and Empirical Implications for
the Study of Civil Conflict. Journal of Peace Research 47(3): 273-285.
Linz Juan and Alfred Stepan (1996) Problems of Democratic Transition and Consolidation.
Southern Europe, South America, and Post-Communist Europe. Cambridge: Cambridge
University Press.
Mansfield, Edward D. and Jack L. Snyder (2007) The Sequencing “Fallacy” Journal of
Democracy 18(3): 5-10.
Melville, Andrei and Denis Stukal (2012). (Re)Building the Ship of State at Sea? State Capacity
and Regime Dynamics in Post-Communist Countries. WP BRP 07/PS/2012.
Melville, Andrei, Denis Stukal and Mikhail Mironyuk (2014). “King of the Mountain” or Why
Postcommunist Autocracies Have Bad Institutions. Russian Politics and Law 52(2): 7-29.
Moller, Jorgen and Svend-Eric Skaaning (2011) Stateness First? Democratization 18(1): 1-24.
Rose, Ricgard and Doh Chull Shin (2001) Democratization Backwards: The Problem of ThirdWave Democracies British Journal of Political Science 32(2): 331-354.
Rustow, Dankwart (1970) Transitions to Democracy: Towards a Dynamic Model. Comparative
Politics 2(3): 337-363.
Scheuerman, William E. (2009) Postnational Democracies Without Postnational States? Some
Skeptical Reflections Ethics and Global Politics 2(1): 41-63.
Tansey, Oisin (2007) Democratization Without a State: Democratic Regime-Building in Kosovo
Democratization 14(1): 129-150.
Tansey, Oisin (2009) Regime-Building: Democratization and International Administration.
Oxford: Oxford University Press.
Thompson, William R. (2014). Indian State Capacity: Where Does It Fit and What Might it
Imply? (Unpublished manuscript).
Tilly, Charles (2007) Democracy. Cambridge: Cambridge University Press.
10