Ceteris paribus dictatorships work better than democracies.

You've never lived under a dictatorship have you? I strongly disagree with the above statement and think it's another good example of your first point.

AFAIK dictatorships are higher variance than democracies, but on average they aren't too differerent (in terms of GDP at least). Most intuitive explanation: a good dictator can do really good things and a bad dictator can do really bad things, but good and bad democracies aren't able to do as much good/bad because the political system moves like molasses.