When Economic Elites Support Democratization: Evidence From Argentina

Abstract

Why do some economic elites support democratization while others oppose? I argue elites’ strategies of labor control play a key role. Economic elites included in authoritarian ruling coalitions benefit from state-backed labor repression, making a democratic transition especially costly. Excluded elites generally benefit less from state-condoned repression and instead pursue co-optive control, providing select concessions designed to monitor and influence worker activities (e.g., employer-sponsored unions). Since co-optation is more easily transferred to democratic contexts, it reduces the risks associated with a democratic transition. Excluded elites are thus more likely to support democratization. I evaluate this argument using a natural experiment that leverages random variation in economic elites’ exclusion from the authoritarian ruling coalition in turn-of-the-twentieth-century Argentina. I employ a novel measure of support for democratization based on an original dataset of local, pro-democracy committees. The findings contribute to scholarship on regime change by examining when economic elites—key authoritarian stakeholders—support democratization.