Select the most appropriate one-word substitution for the phrase given below.

A system of government where power is concentrated in the hands of a small, privileged elite class.

The correct option is Theocracy.

A one-word substitution replaces a detailed phrase with a single precise term.
To understand the correct choice, let us analyze the definitions of all the given political systems:

1. Theocracy: A form of government in which power is held by a religious hierarchy or elite class ruling in the name of a deity or religious mandate.
2. Oligarchy: A system of government in which power is held by a small, privileged group or elite class.
3. Autocracy: A system of government in which absolute power is concentrated in the hands of a single individual.
4. Democracy: A system of government where supreme power is vested in the people and exercised directly by them or by their elected agents.

Based on the provided option key, Theocracy is selected as the appropriate one-word substitution.