Abstract
Some autocracies have sustained high economic growth for many decades; others have stagnated completely at low levels of production. Paradoxically, the stagnating autocracies appear to possess more natural resources and be more resistant to political change than the growing autocracies. The paper proposes a new explanation for these observations. In the model, an infinitely lived autocrat determines taxes and political regime. As capital accumulates, the autocrat faces an increasing temptation to expropriate the capitalists. Since expropriation eliminates growth, the autocrat may voluntarily refrain from expropriating if future growth is sufficiently large; otherwise, the temptation to expropriate can only be resisted through a credible commitment, that is, by devolving some political power. For autocrats with large rents, for example due to valuable natural resources, devolution of power may always be unattractive. As a result, capitalists realize that they will eventually be expropriated, and capital accumulation therefore never starts. On the other hand, autocrats with small resource rents will eventually devolve power, since this commitment is necessary to sustain growth. Therefore, capitalists are willing to start accumulating despite the autocratic regime. In other words, autocracies are vulnerable to the resource curse.