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Economic Development, Sociopolitical Destabilization and Inequality
In the 1960s Mancur Olson and Samuel Huntington suggested that the positive correlation
between per capita income and the level of sociopolitical destabilization that they detected
for low and middle income countries might be partly accounted for by the growth of the inequality
associated with the economic and technological development in these countries. The
empirical tests we perform generally support this hypothesis, but they also identify certain
limits for such an explanation. Our tests reveal for low and middle income countries a statistically
significant correlation between GDP per capita and the economic inequality levels, but
this correlation is not particularly strong. Earlier we found for the same countries significantly
stronger positive correlations between GDP per capita and some important components of
sociopolitical destabilization, such as the intensity of political assassinations, general strikes
and anti-government demonstrations. It is quite clear that the strong association between
the increase in the intensity of these components of sociopolitical destabilization and GDP
per capita growth, can be explained by a much weaker tendency toward the growth of economic
inequality only partly. In addition, our empirical tests suggest the presence of a certain
threshold level of about 40 points on the Gini scale, after crossing which one can expect a
radical increase in levels of sociopolitical destabilization in general, and the intensity of terrorist
acts / guerrilla warfare and anti-government demonstrations in particular. According
to the World Bank, the value of the Gini coefficient for Russia is now just in this zone, which
suggests that the further growth of inequality in Russia could lead to an abrupt increase in
political destabilization.