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on Collective Decision-Making |
| By: | Hans Gersbach; Fikri Pitsuwan; Giovanni Valvassori Bolgè |
| Abstract: | We examine democratic public-good provision with heterogeneous legislators. Decisions are taken by majority rule and an agenda-setter proposes a level of the public good, taxes, and subsidies. Members are heterogeneous with respect to their benefits from the public good. We find that, depending on the status quo public-good level, the agenda-setter will form a coalition with the agents who most desire, or least desire, the public good, and we may observe ‘strange bedfellow’ coalitions. Moreover, public-good provision is a non-monotonic function of the status quo public-good level. In the dynamic setting, public-good provision fluctuates endogenously, even if the agenda-setter stays the same over time. Moreover, the more polarized the legislature is, the higher is the volatility of public-good provision and the longer it may take for a society to recover from negative shocks to public-good provision. We illustrate these findings for a two-party system with polarized parties. |
| Keywords: | legislative bargaining, coalition, public goods, polarization, resilience |
| JEL: | C73 D72 H50 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_11004&r=cdm |
| By: | Gold, Robert; Lehr, Jakob |
| Abstract: | This paper shows that regional policies can decrease populist support. We focus on the "development objective" (Objective-1) of the European Regional Development Fund (ERDF), meant to support lagging-behind regions. For causal inference, we exploit three sources of quasi-exogenous variation in a Regression-Discontinuity-Design (RDD), a Difference-in-Differences framework (DiD), and with matching techniques. Using NUTS3-level panel data on the outcomes of elections to the EU parliament, observed over the period 1999-2019, we consistently find that Objective-1 transfers reduces the vote share of right-fringe parties by about 2.5 pp. Left-fringe party support is not affected. Complementary analyses of individual-level survey data from the Eurobarometer show that the European Regional Policy increases trust in democratic institutions and decreases discontent with the EU. |
| Keywords: | Populism, Regional Policies, European Integration, Regression Discontinuity Design |
| JEL: | D72 H54 R11 R58 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwkwp:287756&r=cdm |
| By: | Ghiglino, C.; Muller, A. |
| Abstract: | We provide a politico-economic theory of income redistribution with endogenous social identity of voters. Our analysis uncovers a non-monotonic relationship between market income inequality and redistributive taxation in line with the mixed evidence on the sign of their empirical relationship: taxation first increases with wage inequality as all voters identify with others, but then drops sharply as affluent voters switch to identify in-group. We further add ethnicity as an identification attribute. Consistent with existing empirical evidence, our model predicts that the presence of ethnic minorities and across ethnic group inequality reduce redistribution, while within ethnic group wage inequality increases it. |
| Keywords: | Inequality, Probabilistic Voting, Redistribution, Social Class, Social Identity, Tax Rate |
| JEL: | D64 D71 D72 H20 |
| Date: | 2023–11–14 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camjip:2320&r=cdm |
| By: | Berriochoa, Kattalina; Busemeyer, Marius R. |
| Abstract: | The rise of knowledge economies is transforming labor markets with substantial socio-political implications. Recent literature suggests that these economies foster voters who, due to the current or potential experience of upward mobility, are less likely to support far-right parties. Using novel survey data for the case of Germany, we examine this assertion by analyzing the association between the local share of knowledge-based economic activity and individual mobility perceptions and vote choices. We find that individual mobility perceptions are - somewhat counterintuitively - more negative in thriving local knowledge economies (LKEs). We also examine how these local economic contexts and mobility perceptions explain vote choices, focusing on support for the Greens and the right-wing populist AfD, finding that electoral support for the Greens is strongly and positively associated with well-developed LKEs and less influenced by mobility perceptions, while the latter matters more in the case of support for the AfD. Yet, we also find that thriving LKEs can reinforce the impact of static mobility perceptions increasing support for the AfD. Our analysis shows that LKEs, while a sign of positive economic growth, can also lead to friction between individuals with different perceptions of mobility likely reflecting the winners and losers of technological and labor market changes at the local level. |
| Keywords: | Political Preferences, Inequality, Knowledge Economy, Populism, Local Context |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cexwps:287740&r=cdm |