New Economics Papers
on Collective Decision-Making
Issue of 2012‒01‒18
six papers chosen by

  1. Growth and Election Outcomes in a Developing Country. By Gupta, Poonam; Panagariya, Arvind
  2. A Pooling Approach to Judgment Aggregation By García-Bermejo, Juan Carlos
  3. Populism, Partisanship, and the Funding of Political Campaigns By Tilman Klumpp
  4. Labor Supply of Politicians By Raymond Fisman; Nikolaj A. Harmon; Emir Kamenica; Inger Munk
  5. Rational Democracy:A Political System for Universal Interest By Mo, Pak Hung
  6. Leading by example in intergroup competition: An experimental approach By Johannes Weisser

  1. By: Gupta, Poonam (National Institute of Public Finance and Policy); Panagariya, Arvind (Columbia University)
    Abstract: With the exception Brander and Drazen (2008), who use a comprehensive cross-country database consisting of both developed and developing countries, the hypothesis that rapid growth helps incumbents win elections has been tested exclusively for the developed countries (e.g., Ray Fair 1978). But since sustained rapid growth offers the prospect of pulling vast numbers of the voters out of poverty within a generation, such an effect is far more likely to be present in the developing rather than developed countries. In this paper, we offer the first test of the hypothesis on a large developing and poor country, India, which has seen its economy grow 8 to 9 percent recently. We first generalize the Fair model to allow for multiple candidates instead for just two and then test it using crossstate data. We find quantitatively large and statistically robust effect of growth on the prospects of the candidates of the state incumbent parties to win elections. Specifically, we use the data on 422 candidates in the 2009 parliamentary elections and show that the candidates of incumbent parties in high-growth states have much better prospects of victory than those in low-growth states.
    Date: 2011–10
  2. By: García-Bermejo, Juan Carlos (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.)
    Abstract: The literature has focused on a particular way of aggregating judgments: Given a set of yes or no questions or issues, the individuals’ judgments are then aggregated separately, issue by issue. Applied in this way, the majority method does not guarantee the logical consistency of the set of judgments obtained. This fact has been the focus of critiques of the majority method and similar procedures. This paper focuses on another way of aggregating judgments. The main difference is that aggregation is made en bloc on all the issues at stake. The main consequence is that the majority method applied in this way does always guarantee the logical consistency of the collective judgments. Since it satisfies a large set of attractive properties, it should provide the basis for more positive assessment if applied using the proposed pooling approach than if used separately. The paper extends the analysis to the pooling supermajority and plurality rules, with similar results.
    Keywords: judgment aggregation; pooling-; separating approach; majority-; special majority-; plurality voting.
    JEL: D70 D71
    Date: 2012–01
  3. By: Tilman Klumpp
    Abstract: We dene populism as a politician's eort to appeal to a large group of voters with limited information regarding a policy-relevant state of nature. In our model, the populist motive makes it impossible for political candidates to communicate their information to voters credibly. We show that the presence of special interest groups (SIGs) with partisan preferences can mitigate this eect and thereby improve policy. This does not happen because SIGs are better informed than policy makers. Instead, campaign contributions by SIGs allow politicians to insulate themselves from the need to adopt populist platforms. We show that a regime in which SIGs are allowed to contribute to political campaigns welfare-dominates (ex ante) regimes in which no such contributions are allowed, or where campaigns are publicly nanced, or where they are funded by the candidates' private wealth.
    Date: 2011–04
  4. By: Raymond Fisman; Nikolaj A. Harmon; Emir Kamenica; Inger Munk
    Abstract: We examine the labor supply of politicians using data on Members of the European Parliament (MEPs). We exploit the introduction of a law that equalized MEPs' salaries, which had previously differed by as much as a factor of ten. Doubling an MEP's salary increases the probability of running for reelection by 23 percentage points and increases the logarithm of the number of parties that field a candidate by 29 percent of a standard deviation. A salary increase has no discernible impact on absenteeism or shirking from legislative sessions; in contrast, non-pecuniary motives, proxied by home-country corruption, substantially impact the intensive margin of labor supply. Finally, an increase in salary lowers the quality of elected MEPs, measured by the selectivity of their undergraduate institutions.
    JEL: D72 D73
    Date: 2012–01
  5. By: Mo, Pak Hung
    Abstract: In this paper, we formulate a political system that can satisfy certain desirable characteristics that include democratic participation, serving for universal interest, public sector efficiency, and sustainable by incentive compatibility and virtuous cycles. The system comprises a set of rules and organizations that provide motivations and supports to the participants for enhancing universal interest. It is a political structure that serves the people, rules by rationality, strives for efficiency and is sustainable. They will drive the society toward harmony and rapid growth in the quality of life for all.
    Keywords: Political System Design; Economic Development
    JEL: H11 D72 P48 P16
    Date: 2012–01
  6. By: Johannes Weisser (IMPRS Uncertainty, MPI for Economics, Jena)
    Abstract: We investigate leading by example in a public goods game in scenarios with and without intergroup competition. Leading by example is implemented via a sequential decision protocol. We examine both one-shot and repeated interaction and make use of the strategy method to characterize followers' conditional responses to the leader's contribution. The results show that only follower but not leader behavior is affected by the introduction of intergroup competition. The change in follower behavior is best described as an increase in cooperation which is not conditional on the leader's decision. When groups interact repeatedly, we do not find that leading by example is able to foster cooperation by itself. It only significantly improves contributions when it is accompanied by intergroup competition.
    Keywords: Public goods, Leading by example, Intergroup competition, Strategy method
    JEL: C72 C91 C92 D74 H41
    Date: 2012–01–06

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