New Economics Papers
on Collective Decision-Making
Issue of 2010‒06‒26
seven papers chosen by

  1. Exporting, Productivity and Government Interventions: Is There a Link? By Elena Besedina
  2. Public Employment and Political Pressure: The Case of French Hospitals By Clark, Andrew E.; Milcent, Carine
  3. Left, Right and Beyond: the Pragmatics of Political Mapping By Jonathan White
  4. The Political Economy of the Subprime Mortgage Credit Expansion By Atif Mian; Amir Sufi; Francesco Trebbi
  6. Reputation, social identity, and social conflict By Smith, John
  7. The cooperative endorsement of a strategic game By Penelope Hernandez; Jose A. Silva-Reus

  1. By: Elena Besedina (Kyiv School of Economics, Kyiv Economic Institute)
    Abstract: Recent theoretical models postulate that only the most productive firms become exporters due to the existence of costs of exporting. Empirical evidence does suggest that exporters are on average more productive than their domestic counterparts. However, contrary to the theory the productivity distribution for exporters and non-exporters overlaps. Motivated by this empirical finding, I extend an existing model of heterogeneous firms by adding endogenous trade policy based on a political economy argument. Using Ukrainian data I identify firms that receive explicit government support in the form of preferential tax policy, subsidies and other exclusive benefits. I find that explicit political support is positively associated with firms’ size, voter turnout and state ownership but not efficiency.
    Keywords: TFP, Exporting, Subsidy, Electoral Competition
    JEL: D24 D72 P26
    Date: 2010–06
  2. By: Clark, Andrew E. (Paris School of Economics); Milcent, Carine (Paris School of Economics)
    Abstract: This paper uses an unusual administrative dataset covering the universe of French hospitals to consider hospital employment: this is consistently higher in public hospitals than in Not-For-Profit (NFP) or private hospitals, even controlling for a number of measures of hospital output. NFP hospitals serve as a benchmark, being very similar to Public hospitals, but without political influence on their hiring. Public-hospital employment is positively correlated with the local unemployment rate, whereas no such relationship is found in other hospitals. This is consistent with public hospitals providing employment in depressed areas. We appeal to the Political Science literature and calculate local political allegiance, using expert evaluations on various parties’ political positions and local election results. The relationship between public-hospital employment and local unemployment is stronger the more left-wing the local municipality. This latter result holds especially when electoral races are tight, consistent with a concern for re-election.
    Keywords: hospitals, public employment, unemployment, political preferences
    JEL: D21 D72 I18 J21
    Date: 2010–06
  3. By: Jonathan White
    Abstract: This paper examines the political categories of ‘Left’ and ‘Right’, in particular as they are evoked and instrumentalised by political actors in the democratic process. Drawing on some of the insights of positioning theory, it shows how ‘Left’ and ‘Right’ are discursive resources deployed, contested and resisted in political exchange. The paper looks in depth at some of the political uses to which Left-Right talk may be put, discussing in particular acts of partisan profiling, of legitimisation and subversion, and the evocation or rejection of political continuity. The paper argues that while these usages can be seen as strategic moves pursued for political advantage, they have a larger significance insofar as they indicate one of the ways the democratically important imagery of Left and Right may remain active in European politics.
    Date: 2010–06
  4. By: Atif Mian; Amir Sufi; Francesco Trebbi
    Abstract: We examine how special interests, measured by campaign contributions from the mortgage industry, and constituent interests, measured by the share of subprime borrowers in a congressional district, may have influenced U.S. government policy toward the housing sector during the subprime mortgage credit expansion from 2002 to 2007. Beginning in 2002, mortgage industry campaign contributions increasingly targeted U.S. representatives from districts with a large fraction of subprime borrowers. During the expansion years, mortgage industry campaign contributions and the share of subprime borrowers in a congressional district increasingly predicted congressional voting behavior on housing related legislation. The evidence suggests that both subprime mortgage lenders and subprime mortgage borrowers influenced government policy toward housing finance during the subprime mortgage credit expansion.
    JEL: D72 G21 L51
    Date: 2010–06
  5. By: Ali T. Akarca (Department of Economics, University of Illinois at Chicago); Cem Baslevent (Department of Economics, Bilgi University)
    Abstract: Using data drawn from a nationwide voter-tendencies survey conducted shortly before the July 2007 parliamentary election in Turkey, inter-party vote movements during the 2002-2007 period are investigated with the Justice and Development Party (AKP) as the focal point. A descriptive analysis relying on two and four-way partitions of the dataset reveals that, in comparison to the relatively small group of ‘deserters’ from the party, the ‘newcomers’ to the AKP are younger, mostly female, more satisfied with the performance of the economy, and more likely to be pro-EU membership. The data also shows that AKP supporters are less educated and less concerned with the threats to secularism than the rest of the voters. The key finding of the econometric work is that economic evaluations—especially retrospective ones— have a strong association with the party choice in the 2007 elections.
    Date: 2010–03
  6. By: Smith, John
    Abstract: We interpret the social identity literature and examine its economic implications. We model a population of agents from two exogenous and well defined social groups. Agents are randomly matched to play a reduced form bargaining game. We show that this struggle for resources drives a conflict through the rational destruction of surplus. We assume that the population contains both unbiased and biased players. Biased players aggressively discriminate against members of the other social group. The existence and specification of the biased player is motivated by the social identity literature. For unbiased players, group membership has no payoff relevant consequences. We show that the unbiased players can contribute to the conflict by aggressively discriminating and that this behavior is consistent with existing empirical evidence.
    Keywords: social identity theory; social fragmentation
    JEL: L14 D74 C72
    Date: 2010–06–08
  7. By: Penelope Hernandez (ERI-CES); Jose A. Silva-Reus (Universitat de Alicante and IUDSP)
    Abstract: This note provides a way to translate a strategic game to a characteristic cooperative game assuming that the set of players of the cooperative game is the set of pure actions of the strategic game. Coalitions generated with only one action for each player and the total coalition characterize the Core. We calculate the worth of the total coalition to guarantee the non-emptyness condition. In particular, for a two-player game, this value is equal to the maximal sum of the diagonals.
    Keywords: Cooperative games, core
    JEL: C7
    Date: 2010–06

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