nep-pol New Economics Papers
on Positive Political Economics
Issue of 2006‒01‒01
nine papers chosen by
Eugene Beaulieu
University of Calgary

  1. Narrow-Tent Democrats and Fringe Others: The Policy Views of Social Science Professors By Klein, Daniel B.; Stern, Charlotta
  2. Who Should Govern Congress? Access to Power and the Salary Grab of 1873 By Lee J. Alston; Jeffrey A. Jenkins; Tomas Nonnenmacher
  3. "One Man, One Dollar"? Examining the equalization argument in support of campaign contribution limits By Christoph Vanberg
  4. How Do Budget Deficits and Economic Growth Affect Reelection Prospects? Evidence from a Large Cross-Section of Countries By Adi Brender; Allan Drazen
  5. Las preferencias individuales por el proteccionismo en "economías pequeñas", ¿fundamento racional? By Natalia Melgar; Máximo Rossi; Laura Rovegno
  6. Explaining Middle Eastern Authoritarianism By Marcus Noland
  7. A Dual Policy Paradox: Why Have Trade and Immigration Policies Always Differed in Labor-Scarce Economies By Timothy J. Hatton; Jeffrey G. Williamson
  8. Affinity and International Trade By Marcus Noland
  9. Public Sector Price Controls and Electoral Cycles By Fatih Ozatay

  1. By: Klein, Daniel B. (Department of Economics); Stern, Charlotta (Swedish Institute for Social Research, Stockholm University)
    Abstract: This paper provides copious results from a 2003 survey of academics. We analyze the responses of 1208 academics from six scholarly associations (in anthropology, economics, history, legal and political philosophy, political science, and sociology) with regard to their views on 18 policy issues. The issues include economic regulations, personal-choice restrictions, and military action abroad. We find that the academics overwhelmingly vote Democratic and that the Democratic dominance has increased significantly since 1970. A multivariate analysis shows strongly that Republican scholars are more likely to land outside of academia. On the 18 policy questions, the Democratic-voter responses have much less variation than do the Republicans. The left has a narrow tent. The Democratic and Republican policy views of academics are somewhat in line with the ideal types, except that across the board both groups are simply more statist than the ideal types might suggest. Regarding disciplinary consensus, we find that the discipline with least consensus is economics. We do a cluster analysis, and the mathematical technique sorts the respondents into groups that nicely correspond to familiar ideological categories: establishment left, progressive, conservative, and libertarian. The conservative group and the libertarian group are equal in size (35 individuals, each), suggesting that academics who depart from the leftist ranks are as likely to be libertarian as conservative. We also find that conservatives are closer to the establishment left than they are to the libertarians.
    Keywords: -
    Date: 2005–10–21
  2. By: Lee J. Alston; Jeffrey A. Jenkins; Tomas Nonnenmacher
    Abstract: We examine the politics of the “Salary Grab” of 1873, legislation that increased congressional salaries retroactively by 50 percent. A group of New England and Midwestern elites opposed the Salary Grab, along with congressional franking and patronage-based civil service appointments, as part of reform effort to reshape “who should govern Congress.” Our analyses of congressional voting confirm the existence of this non-party elite coalition. While these elites lost many legislative battles in the short-run, their efforts kept reform on the legislative agenda throughout the late-nineteenth century and ultimately set the stage for the Progressive movement in the early-twentieth century.
    JEL: D23 D72 D73 N41
    Date: 2005–12
  3. By: Christoph Vanberg
    Abstract: Arguably the most important campaign finance regulations in U.S. federal elections are limits imposed on the amount that an individual or organization may donate to a federal campaign. Such contribution limits are advocated on two separate grounds. The first is that they prevent corruption, the second is that they democratize the financing of campaigns by equalizing the relative influence of donors. According to the latter argument, an equalization of donor influence is desirable because it causes campaign resources to more accurately reflect public support for candidates and their political ideas. I construct a formal model to illustrate this equalization argument in support of contribution limits. The analysis calls attention to a number of implicit assumptions underlying the corresponding money primary analogy for campaign fund-raising. The central assumption is that 1 a candidate's reliance on large contributions is an indicator of negative characteristics not revealed through her campaign communication. The model also suggests a method for testing this assumption, as it implies a negative relationship between a candidate's reliance on large contributions and her electoral success. Using data on elections to the House of Representatives between 1990 and 2002, I find no evidence that such a negative relationship exists. This empirical result casts doubt on the equalization argument in support of campaign contribution limits.
    Date: 2005–11
  4. By: Adi Brender; Allan Drazen
    Abstract: Conventional wisdom is that good economic conditions or expansionary fiscal policy help incumbents get re-elected, but this has not been tested in a large cross-section of countries. We test these arguments in a sample of 74 countries over the period 1960-2003. We find no evidence that deficits help reelection in any group of countries -- developed and less developed, new and old democracies, countries with different government or electoral systems, and countries with different levels of democracy. In developed countries, especially old democracies, election-year deficits actually reduce the probability that a leader is reelected, with similar negative electoral effects of deficits in the earlier years of an incumbent's term in office. Higher growth rates of real GDP per-capita raise the probability of reelection only in the less developed countries and in new democracies, but voters are affected by growth over the leader's term in office rather than in the election year itself. Low inflation is rewarded by voters only in the developed countries. The effects we find are not only statistically significant, but also quite substantial quantitatively. We also suggest how the absence of a positive electoral effect of deficits can be consistent with the political deficit cycle found in new democracies.
    JEL: D72 E62 H62
    Date: 2005–12
  5. By: Natalia Melgar (Departmento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Máximo Rossi (Departmento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Laura Rovegno (Departmento de Economía, Facultad de Ciencias Sociales, Universidad de la República)
    Abstract: Even when the majority of economists agree on the benefits of free trade, everywhere we turn to, trade is restricted. In contexts where politicians offer different policy options and voters demand them based on their individual preferences, one may ask what determines personal preferences on trade policy; which economic, cultural, social elements shape them. The aim of this paper is to answer these questions in the case of economies with a small domestic market, given the relative small size of their population. In this paper we use data from the module on National Identity of the 2003 International Social Survey Program (ISSP), including in our sample countries with a population of around five million inhabitants or less. Based on an ordered probit model, we conclude that the evidence does not support the conclusions on preference formation of the modelo Hecksher-Ohlin trade model, while elements such as religion, political preferences, and nationalism, as well as demographic characteristics, have a significant impact on trade policy preferences.
    Keywords: Preferencias, proteccionismo, economías pequeñas, racionalidad, ISSP.
    JEL: F13
    Date: 2005–11
  6. By: Marcus Noland (Institute for International Economics)
    Abstract: Arab political regimes are both unusually undemocratic and unusually stable. A series of nested statistical models are reported to parse competing explanations. The democratic deficit is comprehensible in terms of lack of modernization, British colonial history, neighborhood effects, reliance on taxes for government finance, and the Arab population share. Interpretation of the last variable is problematic: It could point to some antidemocratic aspect of Arab culture (though this appears not to be supported by survey evidence), or it could be a proxy for some unobservable such as investment in institutions of internal repression that may not be culturally determined and instead reflect elite preferences. Hypotheses that did not receive robust support include the presence of oil rents, the status of women, conflict with Israel or other neighbors, or Islam. The odds on liberalizing transitions occurring are low but rising. In this respect the distinction between the interpretation of the Arab ethnic share as an intrinsic cultural marker and as a proxy for some unobservable is important—if the former is correct, then one would expect the likelihood of regime change to rise only gradually over time, whereas if it is the latter, the probabilities may exhibit much greater temporal variability.
    Keywords: democracy, Middle East, Islam, regime change
    JEL: H1 Z12
    Date: 2005–06
  7. By: Timothy J. Hatton; Jeffrey G. Williamson
    Abstract: Today's labor-scarce economies have open trade and closed immigration policies, while a century ago they had just the opposite, open immigration and closed trade policies. Why the inverse policy correlation, and why has it persisted for almost two centuries? This paper seeks answers to this dual policy paradox by exploring the fundamentals which have influenced the evolution of policy: the decline in the costs of migration and its impact on immigrant selectivity, a secular switch in the net fiscal impact of trade relative to immigration, and changes in the median voter. The paper also offers explanations for the between-country variance in voter anti-trade and anti-migration attitude, and links this to the fundamentals pushing policy.
    JEL: F22 J1 O1
    Date: 2005–12
  8. By: Marcus Noland (Institute for International Economics)
    Abstract: This paper examines the impact of American public attitudes toward foreign countries on the volume of trade. The issue is whether popular attitudes, as elicited in these surveys, convey any information about trust, risk, or transactions costs beyond what can be explained through standard economic models. The results of this paper suggest that they do, with a one standard deviation increase in warmth of feeling associated with a 20 to 31 percent larger trade volume when evaluated at the sample means. These public attitudes are in turn correlated with indices of cultural affinity and political ideology. A one standard deviation increase in the democracy score is associated with a 5 to 7 percent increase in trade. There might be additional secondary effects if democratization was associated with an increased likelihood of the removal of sanctions or the initiation of preferential trade relations.
    Keywords: international trade, gravity model, trust, risk
    JEL: F1 F2 Z13
    Date: 2005–06
  9. By: Fatih Ozatay

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