Does the Financial Crisis Threaten Democracy?

As government stimulus packages taper off, we will see if the world economy is entering a period of sustained recovery, or whether the wounds are deeper than anticipated. Should the crisis not abate quickly, governments already struggling under the weight of excessive spending and decreased revenues will have limited policy options. This will create challenges for governments in many developing countries where economic growth is a key source of political legitimacy. Could the current or future economic crises lead newer democracies back down the road to authoritarianism? Will growing authoritarian states (Iran, Russia, China) come under increasing pressure to democratize? This article seeks to answer these questions by exploring the economic effects of the financial crisis and the potential impacts on political stability in developing countries.