Capitalism, Democracy and Development (formerly Economic Strategies of Nations)

Course Number 1172

Professor Bruce Scott
Winter, 30 Sessions
Exam

Career Focus

For those interested in global business operations, managing multi-country investment portfolios, or managing NGOs in the field of economic development.

Objectives

The primary aim of this course is to provide an analytic framework that will enhance student appreciation of and ability to analyze the complex relationship between capitalism and democracy. Understanding this relationship holds the key to any analysis of why some countries are richer and/or more stable than others. As part of this analysis the course will introduce and apply a framework for the identification, comparison and evaluation of economic strategies of nations.

The course will examine the development of various countries from the perspective of Robert Dahl's hypothesis that capitalism and democracy are systems of governance that coexist in a relationship characterized by antagonistic symbiosis. In this perspective capitalism facilitates the creation of wealth that is conducive to stable democracy, but it also produces rising economic inequality that can become incongruous with democracy, through injustice, corruption, political instability or all three.

The course will explore the historic circumstances that have generated economic inequalities, particularly in former colonies, and under what circumstances capitalism can be expected to reduce or increase these inequalities. In addition, it will explore whether there may be institutional prerequisites to the establishment and/or successful practice of democracy. Since all of the countries considered are capitalist and almost all are democracies, the course will provide a three level framework that can be employed for the study of organized competition.

The last third of the course will consider the hypothesis that US capitalism and democracy have experienced a very considerable transformation since 1970, a transformation in which the US is characterized not only by higher incomes but much greater inequalities than any other developed country. In exploring this hypothesis the course will explore the notion that the deregulation of US capitalism that got underway in the 1970s may have played a role in the rising inequalities as well as the rising incomes, while changes in the way the US practices democracy may also have contributed to increasing incomes and inequality, i.e., that the US is experiencing the antagonistic symbiosis that Dahl has called attention to.

Key questions to be considered include:

  1. Why are some countries rich and others poor?
  2. What are some of the strategies that have helped rich countries get richer?
  3. When and how did the poor countries fall behind, and why has it been so hard for them to catch up?
  4. Do some of the Muslim countries face special developmental obstacles, and if so why has Malaysia been so successful with policies and institutions that emphasize race and religion?
  5. In what ways have US capitalism and democracy been transformed since 1970, and why?
  6. How has/does the transformation of US capitalism affect business conditions in the US; in other countries?

Course Materials

The course is based upon readings as well cases, with the ratio approximately two to one. Most of the readings can be used in the familiar case format. The cases will emphasize strategies of how the rich countries have become richer and how some of the middle income counties surmounted their late start. Some of the readings consist of theory pieces, but most describe recent circumstances in countries.

Requirements

I expect you to be in class, prepared, unless you advise me beforehand. At the same time I am aware that many of you will be actively engaged in a job search and that, on occasion this search may conflict with scheduled classes. I expect you to notify me beforehand of such conflicts. I grade on class participation as well as the final, but when in doubt tend to give somewhat more weight to the written word than some of my colleagues do.

Course Organization

I. Introduction: capitalism and democracy (4 sessions)
II. Capitalism, democracy and economic strategy (15)
III. Capitalism and democracy; the US model in transition (9)
IV. Review and summary (2)