Understanding the relationship between accountability and development thus sheds light on a couple of missing pieces in the democracy-development puzzle. First, it is widely recognized that almost all of the world's prosperous states are democracies. The real debate has always been about how poor countries get there from where they are starting. That is, how do we reconcile the outstanding record of the industrialized democracies with the checkered results generated by democratizers? Focusing on the depth of accountability institutions, a common trait of both the industrialized democracies and democratizers that have grown more rapidly, provides at least part of the answer. Poor countries that started down the democratization path and established strong accountability structures have generally grown rapidly; democracy and development do go together. The prescription of a prolonged period of authoritarian purgatory before enjoying democratic redemption is unwarranted. For that matter, formerly low-income countries like Malta, Mauritius, Botswana, and post-Pinochet Chile have grown so rapidly and steadily that they have made considerable headway in closing the prosperity gap with the industrialized democracies. While at varying stages in the process, Thailand, Poland, Hungary, the Baltic countries, Mozambique, and the Dominican Republic are recent democratizers also on a development fast track. Democratizers that have moved less cogently to establish institutions that constrain political and economic monopolization have generally grown less quickly.

Second, one of the perplexities to the democracy-development debate has been the stellar economic performance of a selected number of authoritarian countries, most notably in East Asia. How have these exceptional autocratic growers bucked the trend? Their strength of accountability institutions has something to do with it. This category of rapidly-growing autocrats, controlling for income, scores 20 to 40 percent better on the various categories of accountability compared to other authoritarian countries. In short, economically vibrant autocracies are clear-cut outliers.

This helps us to understand the anomalous nature of the fast-growing authoritarians. Yes, they do exist but they are far from representative and therefore a poor basis on which to guide development policy. Specifically, over the past 25 years there have been eight authoritarian countries that have enjoyed rapid economic growth for over a decade: Bhutan, China, Egypt, South Korea, Singapore, Taiwan, Tunisia, and Vietnam. This compares to the roughly 60 other authoritarian governments that experienced stagnant growth during this time period. In other words, it is not the authoritarian character of the fast-growing states that explains their remarkable development. The wait for development in low accountability states such as Turkmenistan, Azerbaijan, Belarus, Sudan, Cameroon, Burma, Haiti, and Syria before the promotion of democracy will be a long wait indeed.

Policy Implications

At present, development funding to low-income democracies, as a share of GDP, is no greater than that to authoritarian states. To better reduce poverty and propel economic growth, this should change. International investors and development agencies should instead identify countries undertaking genuine political reform and target resource flows to them with the aim of accelerating their economic growth and material development. The track record suggests that the impact and returns from such investment will be maximized. Directing capital flows to these countries, coupled with the enhanced economic progress these democratizers would experience, accentuates incentives for other developing countries to initiate democratic political reform in earnest.

The United States' recently inaugurated Millennium Challenge Account is a potentially important instrument for such a democracy-focused development strategy. While substantially scaled-back from US President George Bush's original proposal, this US$1 billion annual fund for countries deemed to be ruling democratically, investing in their populations, and to be establishing basic economic rights could facilitate a marked shift in development outlays towards democratizers. To be effective and to ensure that the incentive structure of this program clearly resounds throughout the developing world, however, robust democratic governance standards should be maintained in selecting eligible countries. This would signal to non-democratic countries that hope to participate in the program that the prospect of gaining access to increased development funding is linked to their pursuit of genuine democratic reforms. The humanitarian instinct to loosen the standards, thereby allowing more countries to qualify for this new pot of resources, would inadvertently undercut the distinctive purpose of this program and should therefore be resisted.

Pursuing a democracy-centered development strategy recognizes that political orientation is a central feature to development, not just one other desirable objective. Such a perspective requires better integration into the foreign policies of the industrialized democracies. It is not a matter that can be solely relegated to their development agencies. In the United States, for example, it requires greater harmonization of the of the policies of the State, Treasury, and Commerce Departments—and in an age of shifting security threats, the Defense Department and Central Intelligence Agency. What is required is no less than a coherent foreign policy toward the developing world—something that has not existed in the United States for decades. Within agencies whose primary mission is development, such as the US Agency for International Development, better integration of experts dealing with democracy and development issues is needed. Despite their evident complementarities, there remains substantial stove-piping among specialists in these fields. Given the close relationship between democratic governance and positive development outcomes, this compartmentalization is a handicap.

Recognizing the central role that accountability institutions play in development also provides a framework for more effectively targeting development resources. While moving towards a "culture of accountability" and the adoption of political institutions that facilitate shared power and ensure checks and balances are ultimately up to the society in question, certain external efforts can assist this process. Perhaps most important is holding countries claiming to be democracies to international standards of openness, shared power, and political participation. By enforcing a high bar for international democratic legitimacy—with the diplomatic and capital market benefits this branding entails—the international community is ensuring that an incentive structure is in place to propel international reforms, which in turn have a better chance of being sustained. Meanwhile, internal efforts should focus on enhancing the capacity of democratizing countries' institutions of accountability: strengthening the caliber of the civil service, the judiciary, the oversight of the executive branch, and the autonomy of the private sector from political influences. Particular attention should be paid to the establishment of independent media. A free press augments the ability of other institutions, including civil society, to exert the checks and balances against centralized control so critical for sustained development. Mechanisms by which the general public can become better informed of policy debates, actions of public officials, management of public finances, and the functioning of markets will enhance transparency, efficiency, and pressure for corrective action. International efforts can help develop a cadre of trained journalists and media institutions with a clear understanding of their roles and responsibilities. Technical support for the management and marketing skills needed to run regional and national newspapers, television, and radio stations can also better ensure the financial and technological independence of these ventures over time. Notably, these efforts should not be limited to the public sector. Mobilizing private investment into media enterprises, most viably with local partners, further enhances prospects for their sustainability.