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on Positive Political Economics |
| By: | Christopher Blattman |
| Abstract: | What is the political legacy of violent conflict? This paper presents evidence for a link between war, violence and increased individual political participation and leadership among former combatants and victims of violence, and uses this link to understand the deeper determinants of individual political behavior. The setting is northern Uganda, where rebel recruitment methods generated quasi-experimental variation in who became a rebel conscript and who did not. Original survey data shows that the exogenous element of conscription (by abduction) leads to significantly greater political participation later in life. The principal determinant of this increased political participation, moreover, appears to be war violence experienced. Meanwhile, abduction and violence do not appear to affect multiple non-political types of community participation. I show that these patterns are not easily explained by models of participation based on simple rational preferences, social preferences, mobilization by elites, or information availability. Only ‘expressive’ theories of participation appear consistent with the patterns observed, whereby exposure to violence augments the value a person places on the act of political expression itself. The mplications for general theories of political participation are discussed. |
| Keywords: | violence, political participation, Uganda |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:cgd:wpaper:138&r=pol |
| By: | Stephen Haber (Stanford University); Enrico Perotti (University of Amsterdam) |
| Abstract: | This survey reviews the literature on the political economy of financial structure, broadly defined to include the size of capital markets and banking systems as well as the distribution of access to external finance across firms. The theoretical literature on the institutional basis for financial development and the recent evidence suggests that unconstrained political power undermines financial accumulation. Even under limited government, unaccountable institutions lead to regulatory capture, favor connected interests, and undermine finance access and entry. Thus the degree of access to political rights by citizens thus strongly affects their access to finance. Finally, we review the recent literature on the time variation of financial development across democracies during the XX century. |
| Keywords: | political institution; property rights; investor protection; financial development; access to finance; entry; banking |
| JEL: | G21 G28 G32 P16 |
| Date: | 2008–04–25 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20080045&r=pol |
| By: | Jordi Blanes i Vidal; Clare Leaver |
| Abstract: | Tenured public officials such as judges are often thought to be indifferent to the concerns of the elctorate and, as a result, potentially lacking in discipline but unlikely to pander to public opinion. We investigate this proposition empirically using data on promotion decisions taken by senior English judges between 1985 and 2005. Throughout this period the popular view was one of ill-disciplined elitism: senior judges were alleged to be favouring candidates from elite backgrounds over their equally capable non-elite counterparts. We find no evidence of such ill-discipline; most of the unconditional difference in promotion prospects between the two groups can simply be explained by differences in promotion-relevant characteristics. However, exploiting an unexpected proposal to remove control over promotions from the judiciary, we do find evidence of pandering. When faced by the prospect of losing autonomy, senior judges began to favour non-elite candidates, as well as candidates who were unconnected to members of the promotion committee. Our finding that tenured public officials can display both the upsides and downsides of electoral accountability has implications for the literature on political agency, as well as recent constitutional reforms. |
| Keywords: | Electoral Accountability, Judges, Promotion Decisions |
| JEL: | H11 J44 J45 J70 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:390&r=pol |
| By: | Christoph A. Schaltegger; Lars P. Feld |
| Abstract: | The fiscal commons problem is one of the most prominent explanations of excessive spending in political economics. The more fragmented a government, the higher its spending. In this paper we investigate to what extent this problem can be mitigated by different fiscal or constitutional insti-tutions. We distinguish between two variants of fragmented governments: cabinet size and coali-tion size. In addition, we analyze whether constitutional rules for executive and legislature as well as formal fiscal restraints shape the size of government and how different rules interact with fragmentation in determining government size. The empirical analysis of the role of fragmented governments for fiscal policy outcomes is based on a panel of 26 Swiss cantons from 1980-1998. The results indicate that the number of ministers in the cabinet is negatively associated with fiscal discipline. Furthermore, fiscal referendums effectively restrict the size of government, while for-mal fiscal restraints more effectively restrict the fiscal commons problem. (This is a thoroughly revised version of Crema WP Nr. 2004-15) |
| Keywords: | Fragmentation; Fiscal Policy; Referendums; Legislative Rules; Formal fiscal restraints |
| JEL: | E61 E63 H61 |
| Date: | 2008–04 |
| URL: | http://d.repec.org/n?u=RePEc:cra:wpaper:2008-10&r=pol |
| By: | Soubeyran, R. |
| Abstract: | Does a disadvantaged candidate always choose an extremist program? When does a less competent candidate have an incentive to move to extreme positions in order to differentiate himself from the more competent candidate? Recent works answer by the affirmative (Groseclose 1999, Ansolabehere and Snyder 2000, Aragones and Palfrey 2002, 2003). We consider a two candidates electoral competition over public consumption, with a two dimensional policy space and two dimensions of candidates heterogeneity. In this setting, we show that the conclusion depends on candidates relative competences over the two public goods and distinguish between two types of advantages (an absolute advantage and comparative advantage in providing the two public goods). ...French Abstract : Cet article traite de l'entrée dans une industrie dans laquelle les firmes partagent une réputation collective. Premièrement, nous montrons que l'entrée libre n'est pas socialement optimale, il existe un besoin de régulation à travers l'imposition d'un standard minimum de qualité (par exemple). Deuxièmement, nous montrons qu'un standard minimum de qualité peut inciter des firmes à entrer sur le marché. Contrairement à la pensée commune, un standard minimum de qualité ne doit pas être toujours considéré comme une barrière à l'entrée. |
| Keywords: | CANDIDATE QUALITY; EXTREMISM; PUBLIC GOODS CONSUMPTION |
| JEL: | C72 D72 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:umr:wpaper:200801&r=pol |
| By: | Vijaya Ramachandran; Manju Kedia Shah; Gaiv Tata |
| Abstract: | Prior research has emphasized that the high costs and risks arising from a poor investment climate—lack of clear property rights, macro-instability, the burden of regulation and taxation, poor infrastructure, lack of finance, and lack of human capital—have impeded the development of the private sector in sub-Saharan Africa, despite adoption of structural adjustment and liberalization policies. Given the resulting wide differentials in productivity, it is not surprising that most of the African manufacturing sector has not been competitive in exports. However, trade liberalization should have had greater impact on domestic markets for manufactured goods in Africa, leading to either a rapid decline in the size of the manufacturing sector due to import competition, or to a rapid increase in productivity of surviving enterprises. In fact, neither has happened to any significant degree over the last 20 years. Based on data from enterprise surveys conducted by the Regional Program for Enterprise Development at the World Bank, this paper argues that some African manufacturing enterprises have continued to retain their market leadership in domestic markets by investing in relationships with governments, thereby maintaining high barriers to entry and a reduced degree of competition. This influence is particularly severe in some countries in Africa and is often driven by relatively few enterprises. In particular, Zambia and Kenya seem to suffer a high degree of influence-peddling, while Mali and Senegal are at the low end of the scale. Comparisons with selected countries in Asia show that lobbying in East Africa is different than in Asia—larger enterprises, and enterprises with higher market share lobby in Africa, as compared to Asia where market share is not a significant determinant of lobbying activity. The results imply that attempts to improve the productivity of the African private sector through focusing only on the removal of trade barriers, improvements in the investment climate, and private sector capacity building will at most be partially successful. In order to escape from the current low-level equilibrium trap, future reforms will need to explicitly consider political economy issues. From this perspective, the role of regional integration as a tool of competition policy will need to be given greater consideration. |
| Keywords: | Africa, economic reform, influence-peddling |
| Date: | 2007–10 |
| URL: | http://d.repec.org/n?u=RePEc:cgd:wpaper:127&r=pol |