An Economic Theory of Political Revolutions

Abstract

This paper presents a tractable and parsimonious theory of political revolutions in societies devoid of democratic processes. I frame a society constituting a ruler seeking to prevent uprising and a revolutionary leader attempting to induce revolt. Both seek to appeal to a populace consisting of elites and workers by implementing concessionary policies. Due to limited resources, policies benefiting the elite confer disutility to workers, and vice versa. Workers and elites face a binary choice between loyalism and revolution, and their decision affects the likelihood that a revolution succeeds. Since the ruler seeks to minimise the risk of being deposed, the ruler threatens to punish both workers and elites as a deterrent. The propensity of workers to revolt depends on current and proposed policies, their risk profiles, the elites' decision, and the punishment levied. The equilibrium number of revolutionaries depends on the convexity of the probability of successful insurrection.