New Economics Papers
on Collective Decision-Making
Issue of 2011‒08‒29
nine papers chosen by

  1. A Political Theory of Populism By Daron Acemoglu; Georgy Egorov; Konstantin Sonin
  2. Incumbency as the Major Advantage: The Electoral Advantage for Parties of Incumbent Mayors By Ronny Freier
  3. Ethnicity and Election Outcomes in Ghana By Thomas Bossuroy
  4. Politics and the geographic allocation of public funds in a semi-democracy. The case of Ghana, 1996-2004 By Pierre André; Sandrine Mesplé-Somps
  5. The Pivotal Mechanism Revisited: Some Evidence on Group Manipulation By Anita Gantner; Wolfgang Höchtl; Rupert Sausgruber
  6. Coalitional Bargaining Equilibria By John Duggan
  7. Can We Really Change EU Law? The European Citizens' Initiative By Radulescu, Crina
  8. Why Do Populist-Outsiders Get Elected? A Model of Strategic Populists By Sebastian Miller
  9. Uncovered Sets By John Duggan

  1. By: Daron Acemoglu; Georgy Egorov; Konstantin Sonin
    Abstract: When voters fear that politicians may have a right-wing bias or that they may be influenced or corrupted by the rich elite, signals of true left-wing conviction are valuable. As a consequence, even a moderate politician seeking reelection chooses “populist’ policies - i.e., policies to the left of the median voter - as a way of signaling that he is not from the right. Truly right-wing politicians respond by choosing more moderate, or even left-of-center policies. This populist bias of policy is greater when the value of remaining in office is higher for the politician; when there is greater polarization between the policy preferences of the median voter and right-wing politicians; when politicians are indeed more likely to have a hidden right-wing agenda; when there is an intermediate amount of noise in the information that voters receive; when politicians are more forward-looking; and when there is greater uncertainty about the type of the incumbent. We show that similar results apply when some politicians can be corrupted or influenced through other non-electoral means by the rich elite. We also show that ‘soft term limits’ may exacerbate, rather than reduce, the populist bias of policies.
    JEL: C71 D71 D74
    Date: 2011–08
  2. By: Ronny Freier
    Abstract: This paper provides empirical evidence on the party incumbency advantage in mayoral elections in Germany. Using a regression discontinuity design on a data set of about 25,000 elections, I estimate a causal incumbency effect of 38-40 percentage points in the probability of winning the next mayor election. The electoral advantage is larger for fulltime mayors, increasing in municipality size, independent of the specific partisanship of the mayor and constant between 1945 and 2010. Moreover, it increases with local spending hikes and it is independent of municipal debt. I also illustrate the causal dynamic effects of the incumbent status on distant future elections and therefore evaluate the global properties of the LATE estimate. Finally, I show that the total effect is due to an effect on the probability that the party participates in the next election (about 40% of the total effect) and an effect on the vote share (about 60%).
    Keywords: Mayor elections, regression discontinuity design party incumbency advantage
    JEL: H10 H11 H77
    Date: 2011
  3. By: Thomas Bossuroy (SALDRU, University of Cape Town, South Africa UMR DIAL-Paris-Dauphine)
    Abstract: Is ethnicity the critical determinant of election results in Africa? We investigate this question empirically on the 2004 presidential poll in Ghana. We use variables from several data sources matched at the district level, and perform econometric analysis on the turnout rate and party vote shares, and on their evolution between two similar polls. We test the accuracy of two alternate models of voting, an ethnic model and a non-ethnic one that includes variables such as education, occupation or wealth. We provide robust evidence that the ethnic factor is a slightly better explaining factor for the structure of votes in Ghana, but does not rule out the significance of the non-ethnic model. We then show that the ethnic model fails to account accurately for the evolution of votes between two polls, which appears as the result of evaluative votes. Since a changeover of political power has occurred repeatedly in Ghana, the analysis of the motives of the pivotal voter is crucial. Our results show that non-ethnic determinants may ultimately drive election outcomes. _________________________________ L’ethnicité est-elle le déterminant majeur des résultats électoraux en Afrique? Nous étudions empiriquement cette question pour le scrutin présidentiel de 2004 au Ghana, en utilisant des données provenant de sources variées, assemblées au niveau du district. Nous conduisons une analyse économétrique du taux de participation et des résultats des partis politiques, ainsi que de leur évolution entre deux élections similaires. Nous testons la précision de deux modèles alternatifs de vote, un modèle ethnique et un non-ethnique qui inclut des variables telles que l’éducation, la profession ou la richesse. Nous montrons que le facteur ethnique surpasse légèrement le modèle non-ethnique pour expliquer la structure des votes au Ghana, même si ce dernier reste statistiquement valide. Mais le modèle ethnique explique très mal l’évolution des votes entre deux élections, qui apparaît comme le résultat d’un vote d’évaluation politique non ethnique. Comme des alternances se sont produites au Ghana plusieurs fois, les motivations de l’électeur pivot sont cruciales. Nos résultats montrent donc que les facteurs non-ethniques semblent déterminer les résultats des élections.
    Keywords: Vote, Ethnicity, Elections, Africa.
    JEL: D72 O1
    Date: 2011–04
  4. By: Pierre André (Université de Cergy-Pontoise, THEMA); Sandrine Mesplé-Somps (DIAL, IRD, Paris)
    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. _________________________________ La littérature économique portant sur la compréhension des comportements distributifs des gouvernements de pays démocratiques peut échouer à comprendre les mécanismes distributifs à l’oeuvre dans des pays semi-démocratiques africains. Les travaux théoriques et empiriques d’économie politique trouvent généralement que les partis au pouvoir ciblent les fonds publics soit vers les populations qui les soutiennent fortement, soit vers les endroits où les résultats des élections antérieures sont en ballotage séré. Cependant, nous montrons le contraire dans le cas du Ghana. Nous observons que, lorsque le parti NDC était au pouvoir, les districts les plus pro-gouvernementaux ont reçus moins de biens publics que les autres districts. De même nous ne décelons pas de ciblage vers les districts en ballotage. Nous soutenons qu’un tel phénomène est en partie du au fait que le gouvernement, pour rester en place, souhaite avoir les bonnes grâces de l’opposition. C’est ainsi que dans un pays semi-démocratique tel que le Ghana, le gouvernement tout en poursuivant des objectifs électoralistes craint l’instabilité politique et tente de maitriser toute agitation politique potentielle en négociant avec les leadeurs de l’opposition. Notre analyse montre aussi qu’en contrôlant par les votes et autres co-variables telles que le taux d’urbanisation, le niveau de richesse et la densité de population, les allocations de fonds publics ne sont pas fonction de considérations ethniques.
    Keywords: Public goods, Elections, Politics, Ghana.
    JEL: D72 O55 R53
    Date: 2011–03
  5. By: Anita Gantner; Wolfgang Höchtl; Rupert Sausgruber
    Abstract: This paper studies the vulnerability of the pivotal mechanism with respect to manipulation by groups. In a lab experiment, groups decide on the implementation of various alternatives, some of which imply opposite interests for the two subgroups. We investigate the occurrence of tacit and explicit collusion by allowing for communication within subgroups in one treatment and prohibiting it in another. Even though all agents' preferences are common knowledge and there exists a simple symmetric collusive strategy for one subgroup, we find little evidence for tacit collusion, not even with increasing experience. Only when explicit communication is allowed, collusion is established, and it becomes even more pronounced over time.
    Keywords: Collective Decision Making, Pivotal Mechanism, Collusion
    JEL: D71 D61 C92
    Date: 2011–07
  6. By: John Duggan (W. Allen Wallis Institute of Political Economy, 107 Harkness Hall, University of Rochester, Rochester, NY 14627-0158)
    Abstract: This paper takes up the foundational issue of existence of stationary subgame perfect equi- libria in a general class of coalitional bargaining games that includes many known bargaining models and models of coalition formation. General sufficient conditions for existence of equilib- ria are currently lacking in many interesting environments: bargaining models with non-concave stage utility functions, models with a Pareto optimal status quo alternative and heterogeneous discount factors, and models of coalition formation in public good economies with consumption lower bounds. This paper establishes existence of stationary equilibrium under compactness and continuity conditions, without the structure of convexity or comprehensiveness used in the extant literature. The proof requires a precise selection of voting equilibria following different proposals. The result is applied to obtain equilibria in models of bargaining over taxes, coalition formation in NTU environments, and collective dynamic programming problems.
    Date: 2011–05
  7. By: Radulescu, Crina
    Abstract: The Lisbon Treaty introduces a new form of public participation in European Union policy shaping, the European citizens' initiative (ECI). The European Citizens' Initiative is one of the major innovations of this treaty aiming to increase participatory democracy in the European Union (EU).The ECI will allow 1 million citizens from at least one quarter of the EU Member States to invite the European Commission to call directly on the European Commission to bring forward an initiative of interest to them in an area of EU competence. As required by the Treaty, on a proposal from the European Commission, the European Parliament and the Council adopted a Regulation which defines the rules and procedure governing this new instrument (Regulation (EU) No. 211/2011 of the European Parliament and of the Council 16 February 2011 on the citizens' initiative). In accordance with the Regulation, it will only be possible to launch the first European Citizens' Initiatives from 1 April 2012. This initiative includes several steps: identifying and developing an idea, verifying the legality, considering the alternatives, taking into account the research ECI procedures, writing the initiative, building a multinational citizens' initiative committee, building an alliance, evaluating the opposition, developing a budget and in our analysis will identify the weaknesses and the strong points. The methodology of research comprises bibliographic studies and different analysis of the Regulation (EU) No. 211/2011 of the European Parliament and of the Council on the citizens' initiative).
    Keywords: participatory democracy; European Citizens' Initiative
    Date: 2011–07–16
  8. By: Sebastian Miller
    Abstract: The existence of populist regimes led by outsiders is not new in history. In this paper a simple framework is presented that shows how and why a populist outsider can be elected to office, and under what conditions he is more likely to be elected. The results show that countries with a higher income and wealth concentration are more likely to elect populist outsiders than countries where income and wealth are more equally distributed. It is also shown that elections with a runoff are less likely to bring these populist outsiders into office.
    JEL: D72 D31
    Date: 2011–05
  9. By: John Duggan (W. Allen Wallis Institute of Political Economy, 107 Harkness Hall, University of Rochester, Rochester, NY 14627-0158)
    Abstract: This paper covers the theory of the uncovered set used in the literatures on tournaments and spatial voting. I discern three main extant definitions, and I introduce two new concepts that bound exist- ing sets from above and below: the deep uncovered set and the shallow uncovered set. In a general topological setting, I provide relationships to other solutions and give results on existence and external stability for all of the covering concepts, and I establish continuity properties of the two new uncovered sets. Of note, I characterize each of the uncovered sets in terms of a decomposition into choices from externally stable sets; I define the minimal generalized covering solution, a nonempty refinement of the deep uncovered set that employs both of the new relations; and I define the acyclic Banks set, a nonempty generalization of the Banks set.
    Date: 2011–05

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