This week's Becker-Posner takes on the subject of whether economic freedom leads to political freedom, or vice versa. Becker sums his view on the literature:
The consensus among these studies is that countries are likely to become democratic if economic growth succeeds in raising their average incomes to high enough levels. And countries with greater economic freedom, that is with freer markets and more secure private property, produce faster growth and greater prosperity than countries that sharply limit economic freedoms. Moreover, this strong positive relation between economic freedom and growth is largely independent of the degree of political freedom.
These studies also find that the effect of political freedom on subsequent economic growth is weak... I believe that democracies are not especially successful at generating economic prosperity because powerful interest groups develop under democracies (and other political systems too). These groups compete for economic favors that often are at the expense of economic efficiency.
By contrast, when economic freedoms lead to greater prosperity, that encourages a widespread desire for more political freedom. With freer markets,entrepreneurs and management travel abroad more often to meet customers and suppliers, and incidentally learn about the freedoms elsewhere. A growing middle class takes trips to other countries, and they send their children abroad to study at top schools. University students read the great works that show the advantages of political freedoms. More families become highly literate as education progresses, and families learn about the world from cable and satellite television, and from the internet.
His view on China makes a lot of sense to me.
This analysis implies, in particular, that if China continues to grow rapidly, the Chinese people will become increasingly dissatisfied with censorship and their limited political freedom. Already they have much greater freedom than under Mao to voice different opinions, and to criticize the government -if not done too stridently and openly. These forces will gather steam, and I believe they will lead before long to a much more open political process.