New Economics Papers
on Collective Decision-Making
Issue of 2005‒09‒11
three papers chosen by

  1. Iterative elimination of weakly dominated strategies in binary voting agendas with sequential voting By Hummel, Patrick
  2. Did Political Constraints Bind During Transition? Evidence from Czech Elections 1990-2002 By Orla Doyle; Patrick Paul Walsh
  3. A theory of political cycles By Leonardo Martinez

  1. By: Hummel, Patrick
    Keywords: perfect information games, extensive games, backward induction, weakly dominated strategies, iterative elimination of weakly dominated strategies, binary voting agendas, sequential voting
    Date: 2005–08
  2. By: Orla Doyle (University College Dublin); Patrick Paul Walsh (Trinity College Dublin and IZA Bonn)
    Abstract: Many theoretical models of transition are driven by the assumption that economic decision making is subject to political constraints. In this paper we empirically test whether the winners and losers of economic reform determined voting behaviour in the first five national elections in the Czech Republic. We propose that voters, taking stock of endowments from the planning era, could predict whether they would become "winners" or "losers" of transition. Using survey data we measure the percentage of individuals by region who were "afraid" and "not afraid" of economic reform in 1990. We define the former as potential "winners" who should vote for pro-reform parties, while latter are potential "losers" who should support leftwing parties. Using national election results and regional economic indicators, we demonstrate that there is persistence in support for pro-reform and communist parties driven by prospective voting based on initial conditions in 1990. As a result, we show that regional unemployment rates in 2002 are good predictors of regional voting patterns in 1990.
    Keywords: political constraints, prospective economic voting, initial conditions
    JEL: D72 E24 E61
    Date: 2005–07
  3. By: Leonardo Martinez
    Abstract: The literature on political cycles argues that the proximity of elections affects policy choices. This literature considers that opportunistic policymakers manipulate policy to increase their reelection probability. Previous theoretical studies assume that the policymaker can affect his reelection probability only with his last decision before the election. This assumption seems extreme, and directly produces a cycle without presenting a theory of why a policymaker's behavior is different closer to the election. We shall explain how, without this assumption, existing political-agency models can still produce cycles. In contrast to previous (theoretical and empirical) studies, we consider how the policymaker's decisions depend on his reputation (the beliefs about his future performance). Since the policymaker's reputation most likely changes over time, in general, one cannot conclude from observing the same behavior throughout the policymaker's term that the proximity of elections does not affect policy choices. Consequently, our findings suggest reinterpreting previous empirical results and controlling for changes in reputation in future empirical studies. More generally, our results deepen the understanding of agency relationships in which the agent's compensation is decided infrequently.
    Keywords: Political science
    Date: 2005

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