Editing Democratization (section)

====Capital Mobility====
Theories on causes to democratization such as economic development focuses on the aspect of gaining capital. Capital mobility focuses on the movement of money across borders of countries, different financial instruments, and the corresponding restrictions. In the past, there have been multiple theories as to what the relationship is between capital mobility and democratization. <ref>FREEMAN, J. R., & QUINN, D. P. (2012). The Economic Origins of Democracy Reconsidered. American Political Science Review, 106(1), 58–80. doi:10.1017/S0003055411000505</ref>

The “doomsway view” is that capital mobility is an inherent threat to underdeveloped democracies by the worsening of economic inequalities, favoring the interests of powerful elites and external actors over the rest of society. This might lead to depending on money from outside, therefore affecting the economic situation in other countries. [[Sylvia Maxfield]] argues that a bigger demand for transparency in both the private and public sectors by some investors can contribute to a strengthening of democratic institutions and can encourage democratic consolidation. <ref>Maxfield, S. (2000). Capital Mobility and Democratic Stability. Journal of Democracy 11(4), 95-106. https://doi.org/10.1353/jod.2000.0080.</ref>

A 2016 study found that [[Preferential trading area|preferential trade agreements]] can increase democratization of a country, especially trading with other democracies.<ref>{{Cite journal|last1=Manger|first1=Mark S.|last2=Pickup|first2=Mark A.|date=2016-02-01|title=The Coevolution of Trade Agreement Networks and Democracy|journal=Journal of Conflict Resolution|language=en|volume=60|issue=1|pages=164–191|doi=10.1177/0022002714535431|s2cid=154493227|issn=0022-0027}}</ref> A 2020 study found increased trade between democracies reduces [[democratic backsliding]], while trade between democracies and autocracies reduces democratization of the autocracies.<ref name="a964">{{cite journal | last=Pronin | first=Pavel | title=International Trade And Democracy: How Trade Partners Affect Regime Change And Persistence | journal=SSRN Electronic Journal | publisher=Elsevier BV | year=2020 | issn=1556-5068 | doi=10.2139/ssrn.3717614 | page=| url=https://wp.hse.ru/data/2020/10/23/1373846754/75PS2020.pdf }}</ref> Trade and capital mobility often involve international organizations, such as the [[International Monetary Fund]] (IMF), [[World Bank]], and [[World Trade Organization]] (WTO), which can condition financial assistance or trade agreements on democratic reforms.<ref>Chwieroth, J. M. (2010). Capital Ideas: The IMF and the Rise of Financial Liberalization. Princeton University Press. http://www.jstor.org/stable/j.ctt7sbnq</ref>