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	<title>Outside in &#187; Stagnation</title>
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	<description>Involvements with reality</description>
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		<title>De-Dynamization</title>
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		<pubDate>Mon, 20 Oct 2014 14:04:27 +0000</pubDate>
		<dc:creator><![CDATA[admin]]></dc:creator>
				<category><![CDATA[Democracy]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Stagnation]]></category>

		<guid isPermaLink="false">http://www.xenosystems.net/?p=3913</guid>
		<description><![CDATA[If you want to break an economy, democracy is the solution you&#8217;re looking for. The crucial reference is to this paper (via Cowan), dedicated to the The $42 Trillion Question: Will Rapid Growth in China and India Persist? The economic consequences of socio-political &#8216;progress&#8217; are spelled out about as clearly as anyone could want: &#8230; [&#8230;]]]></description>
				<content:encoded><![CDATA[<p>If you want to break an economy, democracy is the solution you&#8217;re looking for. The crucial reference is to <a href="http://www.nber.org/papers/w20573">this</a> paper (via <a href="http://marginalrevolution.com/marginalrevolution/2014/10/some-of-the-most-important-sentences-in-economics.html">Cowan</a>), dedicated to the <em>The $42 Trillion Question: Will Rapid Growth in China and India Persist?</em> The economic consequences of socio-political &#8216;progress&#8217; are spelled out about as clearly as anyone could want:</p>
<p><em>&#8230; nearly every country that experienced a large democratic transition after a period of above-average growth (more than the cross-country average of 2 percent) experienced a sharp deceleration in growth in the 10 years following the democratizing transition. Among 22 countries in which episodes of large democratic transition coincided with above-average growth, all but one (Korea in 1987 with an acceleration of only 0.22 percent) experienced a growth deceleration. The combination of high initial growth and democratic transition seems to make some deceleration all but inevitable. The magnitude of the decelerations was very large: The median deceleration across the 22 countries was 2.99 percent and the average deceleration was 3.53 percent.</em></p>
<p>The phenomenon of <a href="http://athousandnations.com/2009/11/18/jonathan-rauch-demosclerosis/">demosclerosis</a> is already theoretically well-<a href="http://mises.org/hoppeintro.asp">grounded</a>. It appears to be a more rapidly-acting poison than even its fiercest critics have acknowledged.</p>
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