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Star Wars did have Monarchy in it if you remember. The queen seems to have been elected to a term and then another leader took that position later I assume. After she stepped down from being queen Amadala was addressed as Senator. I assume the 'queen' was the head of the Government while in office and normally would have sent her Senator to handle things with the Senate rather than go herself, but the circumstances forced her to do so personally. So locally there could be monarchy while in the greater whole there would be what we think of as a democracy.
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