## Income and Democracy: Lipset's Law Revisited

_IMF Working Papers, December 17, 2012_

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## Bibliographic details
- Authors: Anke Hoeffler, Robert H. Bates, Ghada Fayad
- Published: December 17, 2012
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781475596649.001

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### Key findings
- The study revisits Lipset‘s law, which posits a positive and significant relationship between income and democracy, and finds the opposite: a significant and negative relationship between income and democracy—higher/lower incomes per capita hinder/trigger democratization.
- Decomposing overall income per capita into resource and non-resource components:
  - The coefficient on non-resource income per capita is positive and significant.
  - The coefficient on resource income per capita is significant but negative.
- Conclusion: the role of resource income is central to the result that higher income per capita is associated with less democratization in this analysis.

### Methodology
- Estimation approach: dynamic and heterogeneous panel data estimation techniques.

### Policy-relevant implications (from findings)
- Distinctions between resource and non-resource income are crucial when assessing the relationship between income and democratic development.
- Policies addressing democratization should consider the differing political effects of resource-based income versus non-resource-based income.

### Publication and metadata
- Authors: Anke Hoeffler, Robert H. Bates, Ghada Fayad
- Date: December 17, 2012
- Pages: 26
- Volume: 2012
- Issue: 295
- Series: Working Paper No. 2012/295
- DOI: https://doi.org/10.5089/9781475596649.001
- Stock No: WPIEA2012295
- ISBN: 9781475596649
- ISSN: 1018-5941
- Subjects: Income shocks, National income, Natural resources, Personal income
- Keywords: coefficient, income, WP
- Citation example provided on the page: Anke Hoeffler, Robert H. Bates, and Ghada Fayad. "Income and Democracy: Lipset's Law Revisited", IMF Working Papers 2012, 295 (2012), accessed 9/17/2026, https://doi.org/10.5089/9781475596649.001

*IMF Working Paper "Income and Democracy: Lipset's Law Revisited", Working Paper No. 2012/295, DOI: https://doi.org/10.5089/9781475596649.001*

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_Source: https://www.imf.org/en/publications/wp/issues/2016/12/31/income-and-democracy-lipset-s-law-revisited-40172_