Dictatorships, Institutions and Revenues
This paper explores the effect of dictatorial institutions on the revenue composition of states. The higher the degree of institutionalization of the regime, the higher the perceived levels of legitimacy, efficiency and credibility, so taxes that require cooperation and compliance can be more effectively collected from the population. Institutionalized regimes thus make sense if non-tax revenue sources are scarce so limited representation must be granted in exchange for economic support. Our selection-corrected results show that more institutionalized regimes are able to collect more taxes on income, profits and capital gains, taxes on goods and services, taxes on property and payroll taxes. As a result of this increased cooperation, more institutionalized regime are also shown to enjoy higher growth rates and lower rates of government consumption..