Inequality and Growth: the Role of Democracy In the Alesina and Rodrik (1994) study on the impact of inequality on growth, why did they include a dummy for democracies in their empirical estimation? In other words, why did they want to study whether the impact would be different for democracies vis-a-vis non-democracies?
Alesina and Rodrik (1994) wanted to study whether the impact would be different for democracies vis-a-vis non-democracies because they show that 


  in a democracy (where the ``median voter theorem'' applies) the rate
  of taxation is higher and the rate of growth lower, the more unequal
  is the distribution of wealth.


Their model implies that democracies with a more unequal distribution of capital ownership grow less rapidly than more egalitarian democracies. They argue this is because 
the median voter has a relatively small endowment of capital when wealth is unequally distributed, and thus favors high taxes on capital which keep growth low. 

They wanted to estimate this prediction by adding a dummy variable for democracies vis-a-vis non-democracies