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Noteworthy recent works by Boix (2003) and Acemoglu and Robinson (2006) suggest that democratization results from elite considerations of the redistributive costs associated with democracy and the threat of revolution (alternatively referred to as the cost of repression). In both models, the redistributive mechanism whereby higher inequality raises the cost of democratization does most of the heavy lifting. What exactly constitutes the threat of revolution or the cost of repression is under-specified, and there is no sense that the propensity for revolution or the costs of repression evolve in anything but random fashion. In this paper, we outline a simple model in which the poor's relative "class power" or "revolutionary incentive" is conditional on the factors of production they own and the openness of the international trading system. We suggest that exogenous changes in the openness of the international economy have implications for the relative capacity of "workers" or "the poor" to threaten the established order. We examine this hypothesis using data from 1820 to the present, finding that the interaction between labor abundance and the openness of the global economy have important implications for regime stability and democratization. Our theory and evidence provide one account linking the political economy of international trade and inequality with the observed tendency of democracies to appear in "waves". ..PAT.-Unpublished Manuscript [ABSTRACT FROM AUTHOR]

The literature on endogenous institutions highlights inequality as a key factor driving institutional choice. The second generation fiscal federalism literature emphasizes representation and party systems in accounting for varied outcomes across federations but mostly treats these factors as exogenous. Yet party systems and institutions of representation in federations are endogenous. Here we present the first analysis of the institutional bargains over political representation at the founding moment of federations. We argue that socio-economic geography, inter-regional inequality, and the means of preference aggregation combine to shape regional preferences and the outcome of negotiations over the centralization of political authority. We test the argument using a new dataset covering 39 federations across 250 years. By endogeneizing representation, we make several contributions. First, our argument adds to emerging work on the role of geography in shaping political and economic outcomes. Second, our argument bridges the literatures on endogenous institutions and comparative federalism. Finally, we contribute the first systematic analysis of the political economy of institutional innovation in federations. ..PAT.-Unpublished Manuscript [ABSTRACT FROM AUTHOR]