Open Economies, Closed Polities: Financial Globalization And Authoritarian Politics
This project investigates financial openness policies of authoritarian regimes during the modern age of globalized finance. Over the last quarter-century, increasingly restive publics and heightened international mobility of capital have complicated the task of governing authoritarian regimes. Financial globalization created immense opportunities for enrichment and further power consolidation, but it also made authoritarian elites increasingly vulnerable to political challenges that some regimes are better equipped to handle than others. Given this conundrum, I set out to explore the answers to the following questions: Why do some authoritarian regimes opt for greater financial openness than others? How are these decisions related to the tactics these regimes employ to remain in power? How does the nature of the asset base in the economy impact these decisions? This thesis develops a theoretical framework to address these questions, and also evaluates this theory empirically. I construct a game-theoretical argument that endogenizes financial openness policies in a model that accounts for the profit opportunities from openness and the risks associated with increased economic volatility for the authoritarian elites. I argue that when rulers consider adopting a policy of financial openness, they also take into account their ability to maintain political stability after doing so. Greater financial openness is a "double-edged sword": it can increase the value of specific assets, but it can also make the economy more susceptible to external crises. Capacity to use distributive policies to deal with political instability resulting from greater exposure to global financial markets allows authoritarian regimes to afford more financial openness. The argument is then evaluated in the cases of Russia, China and Kazakhstan. The empirical assessment confirms that a combination of control over country-specific wealth and a developed capacity for redistribution allow an authoritarian regime to "have it all," that is to maintain both openness and political stability.
Financial Globalization; Authoritarianism; Russia
Bunce, Valerie Jane
Kirshner, Jonathan David; Pepinsky, Thomas
Ph.D. of Government
Doctor of Philosophy
dissertation or thesis