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Unformatted text preview: =autocrat: tends to impose far higher taxes and to maximize his surplus-he is faced with short time horizon, and it is in his interest to confiscate the property of his subjects, to abrogate contracts he has signed and generally to ignore the long-run economic consequences of his choices =not so in democracies or representative government: Long-time horizon, need to respect individual rights, makes a credible commitment to respect the law, and be aware of long-term consequences of his choices. -here Olson asks the question of how would gov’t by a rational self-interested autocrat compare with a democracy? =the answer is that democratic competition, even when it works badly, does not give the leader of the government the incentive that an autocrat has to extract the maximum attainable social surplus from the society to achieve his personal objectives. +the problem of how to move from autocracy to democracy is a tough one. And we will see in the course of the term....
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