What impact would a theocracy have on its citizens?

The impact would depend on which religion the theocracy is based on. If it is based on a religion where everybody is treated fairly it could work a little like a democracy where the citizens would have some influence in what happens. Also the ruler of the theocracy would have an effect as well. The citizens could be trained to be good hardworking people or the ruler could work the same way as a dictator.