New Economics Papers
on Collective Decision-Making
Issue of 2011‒04‒09
eight papers chosen by

  1. A Model of Party Discipline in a Congress By Zudenkova, Galina
  2. Local Politics and Economic Geography By Berliant, Marcus; Tabuchi, Takatoshi
  3. Campaigns, Political Mobility, and Communication By Hans Gersbach
  4. The Allocation of Public Goods and National Elections in Ghana By André, Pierre; Mesplé-Somps, Sandrine
  5. Design of a Social Security System: Pension System vs. Unemployment Insurance By Yusuke Kinai
  6. The Endogenous Formation of Coalitions to Provide Public Goods: Theory and Experimental Evidence By David M. McEvoy; Todd L. Cherry; John K. Stranlund
  7. Majority relation and median representative ordering By Gabrielle Demange
  8. Is there an election cycle in public employment? Separating time effects from election year effects By Matz Dahlberg; Eva Mörk

  1. By: Zudenkova, Galina
    Abstract: This paper studies party discipline in a congress within a political agency framework with retrospective voting. Party discipline serves as an incentive device to induce office-motivated congress members to perform in line with the party leadership's objective of controlling both the executive and the legislative branches of government. I show first that the same party is more likely to control both branches of government (i.e., unified government) the stronger the party discipline in the congress is. Second, the leader of the governing party imposes more party discipline under unified government than does the opposition leader under divided government. Moreover, the incumbents' aggregate performance increases with party discipline, so a representative voter becomes better off.
    Keywords: Party discipline; Political agency; Retrospective voting; Office-motivated politicians.
    JEL: D72
    Date: 2011–02–01
  2. By: Berliant, Marcus; Tabuchi, Takatoshi
    Abstract: We consider information aggregation in national and local elections when voters are mobile and might sort themselves into local districts. Using a standard model of private information for voters in elections in combination with a New Economic Geography model, agglomeration occurs for economic reasons whereas voter stratification occurs due to political preferences. We compare a national election, where full information equivalence is attained, with local elections in a three district model. A stable equilibrium accounting for both the economic and political sectors is shown to exist. Restricting to an example, we show that full information equivalence holds in only one of the three districts when transport cost is low. The important comparative static is that full information equivalence is a casualty of free trade. When trade is more costly, people tend to agglomerate for economic reasons, resulting in full information equivalence in the political sector. Under free trade, people sort themselves into districts, most of which are polarized, resulting in no full information equivalence in these districts. We examine the implications of the model using data on corruption in the legislature of the state of Alabama and in the Japanese Diet.
    Keywords: Information aggregation in elections; Informative voting; New economic geography; Local politics
    JEL: D82 D72 R12
    Date: 2011–03–22
  3. By: Hans Gersbach (ETH Zurich, Switzerland)
    Abstract: We present a model of elections in which interest group donations allow candidates to shift policy positions. We show that if donations were prohibited, then a unique equilibrium regarding the position choices of candidates would exist. With unrestricted financing of political campaigns two equilibria emerge, depending on whether a majority of interest groups runs to support the leftist or rightist candidate. The equilibria generate a variety of new features of campaign games and may help identify the objective functions of candidates empirically.
    Keywords: elections, campaign contributions, interest groups
    JEL: C72 D72
    Date: 2011–04
  4. By: André, Pierre; Mesplé-Somps, Sandrine
    Abstract: The body of literature on purely democratic countries can sometimes fail to explain the behavior of government in semi-democratic African countries. Empirical and theoretical political economic papers find that public funds target ruling party supporters and swing districts. Our results, however, suggest that the opposite was true of Ghana. We observe that pro-government districts received less public investment when the NDC was in power. We posit that this finding is partially driven by the government's will to curry favor with opposition politicians. Indeed, in addition to pursuing its electoral objectives, the government of an emerging democracy may fear political instability and keep the lid on potential unrest by bargaining with opposition leaders. Our analysis also shows that, when controlling for votes and other covariates (including wealth, urbanization and density), public goods allocation is not driven by ethnic group targeting either.
    Keywords: Public goods, elections, ethnic, Africa, Ghana
    JEL: O1 D7 R11
    Date: 2011–01
  5. By: Yusuke Kinai (Graduate School of Economics, Osaka University)
    Abstract: This paper presents consideration of how the social security system evolves as the attributes of voters change. In our setting, policy determination is based on majority voting. The government has two components of social security policy: a pension system and unemployment insurance. When workers constitute most voters, the pension system is supported and when unemployed people are the majority, unemployment insurance is adopted. Under this setting, employing the concept of structure-induced equilibrium developed by Shepsle (1979), the present paper describes how the contents of the social security system evolve depending on the dynamics of capital accumulation and the unemployment rate, and demonstrates the possibility that one or the other social security system ceases to exist in certain instances.
    Keywords: Social Security, Pension System vs. Unemployment Insurance, Majority Voting, Structureinduced equilibrium.
    JEL: E61 H53 H55
    Date: 2011–03
  6. By: David M. McEvoy (Department of Economics, Appalachian State University); Todd L. Cherry (Department of Economics, Appalachian State University); John K. Stranlund (Department of Resource Economics, University of Massachusetts Amherst)
    Abstract: This paper examines the endogenous formation of coalitions that provide public goods in which players implement a minimum participation requirement before deciding whether to join. We demonstrate theoretically that payoff-maximizing players will vote to implement efficient participation requirements and these coalitions will form. However, we also demonstrate that if some players are averse to inequality they can cause inefficient outcomes. Inequality-averse players can limit free riding by implementing larger than efficient coalitions or by blocking efficient coalitions from forming. We test the theory with experimental methods and observe individual behavior and coalition formation consistent with a model of inequality-averse players.
    Keywords: public goods, coalition formation, inequality aversion, participation requirement, experiments
    JEL: C92 H41
    Date: 2011–04
  7. By: Gabrielle Demange (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris)
    Abstract: This paper presents results on the transitivity of the majority relation and the existence of a median representative ordering. Building on the notion of intermediate preferences indexed by a median graph, the analysis extends well-known results obtained when the underlying graph is a line. In contrast with other types of restrictions such as single-peakedness, intermediate preferences allow for a clear distinction between restrictions on the set of preferences characteristics and those on the set of alternatives.
    Keywords: majority rule ; median graph ; tree ; Condorcet winner ; intermediate preferences
    Date: 2011–03
  8. By: Matz Dahlberg (Uppsala University, IFAU, CESifo & IEB); Eva Mörk (Uppsala University, IFAU, CESifo, IZA & IEB)
    Abstract: Do governments increase public employment in election years? This paper answers this question by using data from Sweden and Finland, two countries that are similar in many respects but in which local elections are held at different points in time. These facts make it possible for us to separate an election effect from other time effects. Our results indicate that there is a statistically significant election year effect in local public employment, a production factor that is highly visible in the welfare services provided by the local governments in the Scandinavian countries. The effect also seems to be economically significant; the municipalities employ 0.6 more full-time employees per 1,000 capita in election years than in other years (which correspond to an increase by approximately 1 percent).
    Keywords: election cycle, public employment, exogenous elections
    JEL: D72 H72 P16
    Date: 2011

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