Is state capacity sufficient to deliver consistent improvements in quality of life, even in the absence of robust democratic accountability? While Westerners long insisted that the answer must be no, China and other socioeconomically successful autocracies have demonstrated that the question is far from settled.
BERLIN – Liberal democracy is again under threat around the world. In many ways, we have seen such challenges before, and democracy has ultimately emerged victorious. Is a similar confidence warranted this time? Anti-democratic threats certainly do not mean the end of the system. But rather than clinging to the optimistic belief in democracy’s inevitable global triumph, its defenders must now adopt a realistic mindset grounded in empirical evidence – especially when the data challenge long-held assumptions and raise uncomfortable questions.
Realism requires us to reject doomsday predictions about the imminent demise of representative government. But it also means abandoning the teleological belief that liberal democracy will inevitably triumph everywhere. We can acknowledge the impressive advances that non-democratic countries have made, without losing sight of the overwhelming evidence that democracies still provide a much higher average quality of life than autocracies.
Today’s world still offers ample opportunities for incremental progress toward greater democratic inclusiveness and accountability and a higher quality of life. But since countries at all levels of economic development face their own set of big, long-term challenges, policies must be tailored to their specific governance dynamics. There is no quick or one-size-fits-all solution.
Toward an Age of Illiberalism?
Evidence of a global “democratic recession” has mounted since it was first identified nearly a decade ago. Research institutes like Freedom House and V-Dem, and leading publications such as The Economist, have found that liberal democracy continues to loseground to autocracy and illiberalism. Such regimes – which include China, Hungary, Russia, Saudi Arabia, Turkey, and many others – are increasingly self-confident and promote their economic and political models as being more conducive to stability and prosperity than those of democratic countries.
This presents a growing challenge to defenders of liberal values. For much of the last half-century, there was little debate about which system produced better outcomes: autocracies were generally expected to trail democracies in almost all development indicators. However, this group of countries has managed to narrow the gap in recent years, even though most still lag in absolute terms of the public goods they provide. Of the 145 countries included in the 2024 Berggruen Governance Index (BGI), nearly half had both a rising quality of life and declining democratic accountability between 2000 and 2021.
This finding poses an ideological and political challenge to conventional wisdom. Could the rise of a potentially successful alternative dethrone liberalism as history’s last man standing? What does autocracy’s perceived success imply for the scholarly debate about democracy’s role in fostering stability, prosperity, and sustainability? Using the BGI, we find that while the paths vary depending on the characteristics of the countries discussed, all can still find a way to “sail against the wind” toward democracy, as the economist Albert Hirschman put it. Progress remains possible, but it will require an incremental zig-zagging pattern, and it is far from assured.
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High Achievers
Using three measures for governance performance – democratic accountability, state capacity, and public-goods provision – the BGI identifies four country clusters with distinct performance patterns and common characteristics in terms of economics, demographics, and political stability. Critically, each cluster faces different challenges when it comes to the role of democracy and quality of life.
First, there are 36 successful democratic states in the world today, a cohort that includes Australia, most European Union countries, Japan, South Korea, and the United States. Members of this group perform the strongest across all three governance dimensions. But while all have highly globalized economies and high per capita GDPs, they increasingly differ in terms of political and social stability. Estonia, for example, has continued to perform well in these dimensions, whereas the US in recent years has not. We believe the future of democracy in this cluster depends on how governments manage the global economy, and whether they build the domestic state capacity needed to achieve both social cohesion and adequate provision of public goods in a competitive international environment.
Although this group is relatively successful across all measures, the decade following the 2008 global financial crisis shows that prolonged austerity and elite complacency can be dangerous for democracy, even in countries where it seems secure. The US appears to be a case in point. Its democratic-accountability score averaged an impressive 96 between 2010 and 2015 (among the best in the world), but then declined precipitously, reaching 84 by 2020. US state capacity also atrophied, falling from 79 in 2011 to 64 in 2020.
It is no coincidence that these changes occurred during Donald Trump’s presidency, which was marked by upheavals for the electoral system and the administrative state. Trump’s takeover of the Republican Party’s base and organizational resources demonstrates that even the seemingly most consolidated democracies are susceptible to illiberal forces and rapid institutional erosion. Although some metrics suggest that the US may have rebounded in recent years, the 2024 election could easily reverse the trend.
The second cluster comprises 33 successful autocratic and illiberal states, such as Russia, China, the United Arab Emirates, and Turkey. These countries have lower scores in democratic accountability, and generally average or below-average state-capacity ratings, but they manage to deliver an average or above-average quality-of-life score. Notwithstanding this relative success, these countries face numerous challenges, including high levels of brain drain, economic and social inequalities, significant domestic grievances, and often suppressed internal conflicts.
These countries are trying to provide evidence for what we label the “autocratic sufficiency thesis,” which holds that state capacity is enough to ensure a higher quality of life, even in the absence of robust democratic accountability. The most prominent example of a country on this path is China. Between 2000 and 2021, its quality of democracy declined from an already low score of 27 to 20. During this same timeframe, however, state capacity increased four points, from 38 to 42. Most importantly, public-goods provision jumped dramatically, from 60 to 75. This ability to increase public goods in the absence of democracy poses the most significant ideological threat to the liberal model. But it remains to be seen whether the trend will hold as China approaches quality-of-life levels comparable to those of wealthy democracies.
Muddle in the Middle
The third cluster contains ineffective states. Despite roughly average levels of democratic accountability and state capacity, these 37 countries – including Peru, Tunisia, South Africa, Indonesia, the Philippines, and Bolivia – struggle to deliver a quality of life at levels commensurate with their democratic accountability and state capacity. As a group, they are average on almost every economic, demographic, and sociopolitical indicator. Democracy is not being accompanied by improvements in the other two dimensions. If this disconnect persists, it could lead to a loss of legitimacy and a slide into authoritarianism.
These states could be representative of the failure of the “democratic sufficiency thesis,” which assumes that democracy alone is sufficient for a higher quality of life in the medium to long term. For example, Tunisian democracy had a remarkable ascent between 2010 and 2021, with its democratic-accountability score rising from 31 to 79, and its score for state capacity increasing from 34 to 55. And yet it failed to translate its democratic renaissance into a better life for its citizens: public-goods provision grew by only four points, from 73 to 77.
The last cluster includes 39 struggling states, such as Cambodia, Egypt, Guatemala, Nigeria, and Venezuela. These countries generally exhibit poor governance performance across all three dimensions, and they tend to register a lower GDP per capita, a higher likelihood of armed conflict, and lower political stability. Many have been trapped in a vicious cycle of internal conflict and poor governance for decades.
Like ineffective states, they are vulnerable to the autocratic narrative that state capacity is the key to development. They therefore represent a key front in the ideological battle between democracy and autocracy. Consider Cambodia, which has suffered a substantial democratic decline, dropping from 48 in 2000 to 32 in 2021, even as state capacity stayed roughly constant (24 versus 22). Over the same period, its public-goods provision improved from 29 to 51. These results could indicate to others that quality of life can be improved even during periods of democratic decline.
Many Questions
These findings raise several pressing questions. If non-democratic countries can increase quality of life, does that mean democracy is less relevant than was previously assumed? This might indeed be the case, at least in the medium term. After all, the extractive-industry “business model” of successful autocracies like the Gulf states and Russia seems relatively stable, as does China’s extremely overweighted reliance on exports. But other countries’ opportunities to adopt the Russian or Chinese business model seem rather limited.
Still, does the growing influence of “successful autocracies” speak to an alternative model that pits the old tenets of modernization theory against the so-called Beijing Consensus? Almost certainly. The highly visible rise of non-democracies poses a genuine challenge to the continued success of the democratic cluster and its attractiveness to other countries. But this is partly about who has the winning narrative, and partly about the unique opportunities available to each country in today’s globalized economy.
Finally, is there a clear way to improve the immediate prospects of countries in the third and fourth clusters? Probably not. Ineffective and struggling states are poised to remain in asynchronous patterns whereby democracy can seem settled, only to be challenged and reversed. State capacity and public-goods provision can continue to develop alongside these changes, but progress may be slow, and setbacks frequent.
On balance, recent trends cast doubt on the hopeful liberal narrative that dominated the first decade after the Cold War. No longer can we assume that countries will inevitably converge toward both democracy and prosperity, as envisioned in the modernization paradigm long championed by the West.
Toward a New Realism
Given that successful liberal democracies are likely to face significant headwinds in the years ahead, a more proactive policy approach is needed to shield vulnerable population groups from the negative impact of economic globalization and technological change. These are issues that many liberal democracies – not least the US – ignored for too long. Such neglect can create a vicious cycle as regions exposed to negative economic shocks come to support populist parties.
We must also recognize the limits of democratic development in autocratic countries, given the relatively stable and economically successful models that some have pioneered. Demeaning the real progress that non-democratic countries have made will not strengthen the case for democracy. Instead, we should emphasize that autocracies generally perform worse over time, and that this tendency may yet be borne out.
At the same time, we should not view democratic backsliding as an inexorable process. As we have seen in Poland over the past year, illiberal regimes can fall, giving way to democratic renewal. Autocracies often develop a faux stability, leaving observers shocked when they suddenly fall. Recall the abrupt demise of European communism. Today’s authoritarians are hardly immune from sharing a similar fate.
Finally, the new realism requires us to acknowledge that many countries in the ineffective- and struggling-state clusters have a long and rocky road ahead. But though there are no quick fixes, the path toward democracy and a higher quality of life remains open. It is worth remembering that even the US did not become a full democracy until the 1960s, with the passage of the Civil Rights Act and the Voting Rights Act; or that Switzerland, among the world’s most affluent and democratic countries, extended the vote to women only in 1971; or that Germany, Japan, and Austria – now rich and stable democracies – were autocratic monarchies (with strong state capacities and reasonable public-goods provision) just over a century ago.
Western-style liberal democracy is not inevitable, because history has no goal or purpose – no “end.” What it does have is human agency, ideological struggle, and political conflict. Because the future is always unwritten, democracy must never stop proving itself.
The Berggruen Governance Index is a joint project of the Berggruen Institute, UCLA’s Luskin School of Public Affairs, and the Hertie School.
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BERLIN – Liberal democracy is again under threat around the world. In many ways, we have seen such challenges before, and democracy has ultimately emerged victorious. Is a similar confidence warranted this time? Anti-democratic threats certainly do not mean the end of the system. But rather than clinging to the optimistic belief in democracy’s inevitable global triumph, its defenders must now adopt a realistic mindset grounded in empirical evidence – especially when the data challenge long-held assumptions and raise uncomfortable questions.
Realism requires us to reject doomsday predictions about the imminent demise of representative government. But it also means abandoning the teleological belief that liberal democracy will inevitably triumph everywhere. We can acknowledge the impressive advances that non-democratic countries have made, without losing sight of the overwhelming evidence that democracies still provide a much higher average quality of life than autocracies.
Today’s world still offers ample opportunities for incremental progress toward greater democratic inclusiveness and accountability and a higher quality of life. But since countries at all levels of economic development face their own set of big, long-term challenges, policies must be tailored to their specific governance dynamics. There is no quick or one-size-fits-all solution.
Toward an Age of Illiberalism?
Evidence of a global “democratic recession” has mounted since it was first identified nearly a decade ago. Research institutes like Freedom House and V-Dem, and leading publications such as The Economist, have found that liberal democracy continues to loseground to autocracy and illiberalism. Such regimes – which include China, Hungary, Russia, Saudi Arabia, Turkey, and many others – are increasingly self-confident and promote their economic and political models as being more conducive to stability and prosperity than those of democratic countries.
This presents a growing challenge to defenders of liberal values. For much of the last half-century, there was little debate about which system produced better outcomes: autocracies were generally expected to trail democracies in almost all development indicators. However, this group of countries has managed to narrow the gap in recent years, even though most still lag in absolute terms of the public goods they provide. Of the 145 countries included in the 2024 Berggruen Governance Index (BGI), nearly half had both a rising quality of life and declining democratic accountability between 2000 and 2021.
This finding poses an ideological and political challenge to conventional wisdom. Could the rise of a potentially successful alternative dethrone liberalism as history’s last man standing? What does autocracy’s perceived success imply for the scholarly debate about democracy’s role in fostering stability, prosperity, and sustainability? Using the BGI, we find that while the paths vary depending on the characteristics of the countries discussed, all can still find a way to “sail against the wind” toward democracy, as the economist Albert Hirschman put it. Progress remains possible, but it will require an incremental zig-zagging pattern, and it is far from assured.
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At a time when democracy is under threat, there is an urgent need for incisive, informed analysis of the issues and questions driving the news – just what PS has always provided. Subscribe now and save $50 on a new subscription.
Subscribe Now
High Achievers
Using three measures for governance performance – democratic accountability, state capacity, and public-goods provision – the BGI identifies four country clusters with distinct performance patterns and common characteristics in terms of economics, demographics, and political stability. Critically, each cluster faces different challenges when it comes to the role of democracy and quality of life.
First, there are 36 successful democratic states in the world today, a cohort that includes Australia, most European Union countries, Japan, South Korea, and the United States. Members of this group perform the strongest across all three governance dimensions. But while all have highly globalized economies and high per capita GDPs, they increasingly differ in terms of political and social stability. Estonia, for example, has continued to perform well in these dimensions, whereas the US in recent years has not. We believe the future of democracy in this cluster depends on how governments manage the global economy, and whether they build the domestic state capacity needed to achieve both social cohesion and adequate provision of public goods in a competitive international environment.
Although this group is relatively successful across all measures, the decade following the 2008 global financial crisis shows that prolonged austerity and elite complacency can be dangerous for democracy, even in countries where it seems secure. The US appears to be a case in point. Its democratic-accountability score averaged an impressive 96 between 2010 and 2015 (among the best in the world), but then declined precipitously, reaching 84 by 2020. US state capacity also atrophied, falling from 79 in 2011 to 64 in 2020.
It is no coincidence that these changes occurred during Donald Trump’s presidency, which was marked by upheavals for the electoral system and the administrative state. Trump’s takeover of the Republican Party’s base and organizational resources demonstrates that even the seemingly most consolidated democracies are susceptible to illiberal forces and rapid institutional erosion. Although some metrics suggest that the US may have rebounded in recent years, the 2024 election could easily reverse the trend.
The second cluster comprises 33 successful autocratic and illiberal states, such as Russia, China, the United Arab Emirates, and Turkey. These countries have lower scores in democratic accountability, and generally average or below-average state-capacity ratings, but they manage to deliver an average or above-average quality-of-life score. Notwithstanding this relative success, these countries face numerous challenges, including high levels of brain drain, economic and social inequalities, significant domestic grievances, and often suppressed internal conflicts.
These countries are trying to provide evidence for what we label the “autocratic sufficiency thesis,” which holds that state capacity is enough to ensure a higher quality of life, even in the absence of robust democratic accountability. The most prominent example of a country on this path is China. Between 2000 and 2021, its quality of democracy declined from an already low score of 27 to 20. During this same timeframe, however, state capacity increased four points, from 38 to 42. Most importantly, public-goods provision jumped dramatically, from 60 to 75. This ability to increase public goods in the absence of democracy poses the most significant ideological threat to the liberal model. But it remains to be seen whether the trend will hold as China approaches quality-of-life levels comparable to those of wealthy democracies.
Muddle in the Middle
The third cluster contains ineffective states. Despite roughly average levels of democratic accountability and state capacity, these 37 countries – including Peru, Tunisia, South Africa, Indonesia, the Philippines, and Bolivia – struggle to deliver a quality of life at levels commensurate with their democratic accountability and state capacity. As a group, they are average on almost every economic, demographic, and sociopolitical indicator. Democracy is not being accompanied by improvements in the other two dimensions. If this disconnect persists, it could lead to a loss of legitimacy and a slide into authoritarianism.
These states could be representative of the failure of the “democratic sufficiency thesis,” which assumes that democracy alone is sufficient for a higher quality of life in the medium to long term. For example, Tunisian democracy had a remarkable ascent between 2010 and 2021, with its democratic-accountability score rising from 31 to 79, and its score for state capacity increasing from 34 to 55. And yet it failed to translate its democratic renaissance into a better life for its citizens: public-goods provision grew by only four points, from 73 to 77.
The last cluster includes 39 struggling states, such as Cambodia, Egypt, Guatemala, Nigeria, and Venezuela. These countries generally exhibit poor governance performance across all three dimensions, and they tend to register a lower GDP per capita, a higher likelihood of armed conflict, and lower political stability. Many have been trapped in a vicious cycle of internal conflict and poor governance for decades.
Like ineffective states, they are vulnerable to the autocratic narrative that state capacity is the key to development. They therefore represent a key front in the ideological battle between democracy and autocracy. Consider Cambodia, which has suffered a substantial democratic decline, dropping from 48 in 2000 to 32 in 2021, even as state capacity stayed roughly constant (24 versus 22). Over the same period, its public-goods provision improved from 29 to 51. These results could indicate to others that quality of life can be improved even during periods of democratic decline.
Many Questions
These findings raise several pressing questions. If non-democratic countries can increase quality of life, does that mean democracy is less relevant than was previously assumed? This might indeed be the case, at least in the medium term. After all, the extractive-industry “business model” of successful autocracies like the Gulf states and Russia seems relatively stable, as does China’s extremely overweighted reliance on exports. But other countries’ opportunities to adopt the Russian or Chinese business model seem rather limited.
Still, does the growing influence of “successful autocracies” speak to an alternative model that pits the old tenets of modernization theory against the so-called Beijing Consensus? Almost certainly. The highly visible rise of non-democracies poses a genuine challenge to the continued success of the democratic cluster and its attractiveness to other countries. But this is partly about who has the winning narrative, and partly about the unique opportunities available to each country in today’s globalized economy.
Finally, is there a clear way to improve the immediate prospects of countries in the third and fourth clusters? Probably not. Ineffective and struggling states are poised to remain in asynchronous patterns whereby democracy can seem settled, only to be challenged and reversed. State capacity and public-goods provision can continue to develop alongside these changes, but progress may be slow, and setbacks frequent.
On balance, recent trends cast doubt on the hopeful liberal narrative that dominated the first decade after the Cold War. No longer can we assume that countries will inevitably converge toward both democracy and prosperity, as envisioned in the modernization paradigm long championed by the West.
Toward a New Realism
Given that successful liberal democracies are likely to face significant headwinds in the years ahead, a more proactive policy approach is needed to shield vulnerable population groups from the negative impact of economic globalization and technological change. These are issues that many liberal democracies – not least the US – ignored for too long. Such neglect can create a vicious cycle as regions exposed to negative economic shocks come to support populist parties.
We must also recognize the limits of democratic development in autocratic countries, given the relatively stable and economically successful models that some have pioneered. Demeaning the real progress that non-democratic countries have made will not strengthen the case for democracy. Instead, we should emphasize that autocracies generally perform worse over time, and that this tendency may yet be borne out.
At the same time, we should not view democratic backsliding as an inexorable process. As we have seen in Poland over the past year, illiberal regimes can fall, giving way to democratic renewal. Autocracies often develop a faux stability, leaving observers shocked when they suddenly fall. Recall the abrupt demise of European communism. Today’s authoritarians are hardly immune from sharing a similar fate.
Finally, the new realism requires us to acknowledge that many countries in the ineffective- and struggling-state clusters have a long and rocky road ahead. But though there are no quick fixes, the path toward democracy and a higher quality of life remains open. It is worth remembering that even the US did not become a full democracy until the 1960s, with the passage of the Civil Rights Act and the Voting Rights Act; or that Switzerland, among the world’s most affluent and democratic countries, extended the vote to women only in 1971; or that Germany, Japan, and Austria – now rich and stable democracies – were autocratic monarchies (with strong state capacities and reasonable public-goods provision) just over a century ago.
Western-style liberal democracy is not inevitable, because history has no goal or purpose – no “end.” What it does have is human agency, ideological struggle, and political conflict. Because the future is always unwritten, democracy must never stop proving itself.
The Berggruen Governance Index is a joint project of the Berggruen Institute, UCLA’s Luskin School of Public Affairs, and the Hertie School.