However, there are alternatives:
Alright, this sounds a bit weird, but it actually fits. If Ancient Greece and Rome could have something approaching democracy, then why not a fantasy world? You can mix it up with aristocracy/senators if you wish or have a pure democracy. As modern America shows, you still end up with dynastic families (Clintons, Kennedys etc) but with the added fun of vote-rigging and propaganda.
Around the 15th century Italy was a proper mess, politically (in terms of money it was actually doing very well). One of the most interesting clashes was between the Guelfs and Ghibellines, the supporters of the Pope and the Holy Roman Emperor (who wasn't holy, wasn't Roman and wasn't an emperor, but still…). A number of lands in Italy were ruled by the clergy, and were ecclesiastical principalities. You can of course make a religious-ruled land very extreme (cf Iran) or have a more moderate version.
The Spartans were famous warriors, but the only reason all the men could afford the time to devote to such a way of life was because of the helots. Helots did the agricultural work necessary to support the Spartans and were a subjugated people (accounts vary as to whether they were entirely slaves or had a sort of halfway status between slavery and freedom).
A mixed constitution
As created by Lycurgus for the Spartans and the system of Rome that Polybius praised, a mixed constitution involves the three noble elements of governance (democracy, aristocracy and monarchy). So, an elected assembly or individuals (tribunes) would be involved, as would a wealthy elite and a small number (not necessarily one, as there were two consuls) of leading lights. Sparta also had two kings, and was therefore a diarchy. Probably a bit trickier to write to get the balance right, but this is a very stable form of government (Sparta's constitution lasted about eight centuries and Rome's about five before it became an empire).
When writing Bane of Souls I realised that both Felaria and Denland (kingdoms) were pretty hierarchical and wanted something different for the Kuhrland (a third 'country'). So, I went for a minimalist approach. The people are not bound together by loyalty to a feudal leader but by common traditions, customs and laws. Taxes don't exist (although custom dictates certain 'donations'), which means people keep more cash, but it also means there isn't money available for a central authority to pave roads or build grand edifices. There's a greater degree of personal freedom, as well as actions being dictated less by noble commands than by the obligations of duty and honour.
For those who think the last option sounds interesting, the Kuhrisch play a role in Bane of Souls and the Kuhrland is the primary setting for the forthcoming Journey to Altmortis, which I hope to have out in the final week of May.