FUNCTIONAL LINKAGE BETWEEN DEMOCRACY AND MARKET IN CAPITALIST SYSTEMS

Modern democracy has existed only in countries with economic systems i n which production and distribution are mainly carried on by privately owned enterprises that are strongly oriented toward markets. Though n ot all capitalist countries are or have been democratic, all democrati c countries have had capitalist economies. It is assumed that the degr ee to which the economy is market oriented mediates the relationship b etween capitalism and democracy. In this sense I assume that the relat ionship between capitalism and democracy has been mediated by the stre ngth of markets in the successful developing countries. In this paper it can be assumed that there are complex feedback loops between market and democracy in capitalist systems. (C) 1997 John Wiley & Sons, Ltd.