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on Positive Political Economics |
| By: | Golden, M.; Picci, L. |
| Abstract: | This paper analyzes the political determinants of the distribution of infrastructure expenditures by the Italian government to the country’s 92 provinces between 1953 and 1994. Extending implications of theories of legislative behavior to the context of open-list proportional representation, we examine whether individually powerful legislators and ruling parties direct spending to core or marginal electoral districts, and whether opposition parties share resources via a norm of universalism. We show that when districts elect politically more powerful deputies from the governing parties, they receive more investments. We interpret this as indicating that legislators with political resources reward their core voters by investing in public works in their districts. The governing parties, by contrast, are not able to discipline their own members of parliament sufficiently to target the parties’ areas of core electoral strength. Finally, we find no evidence that a norm of universalism operates to steer resources to areas when the main opposition party gains more votes. |
| Keywords: | Pork barrel, distributive politics, electoral systems, Italy, public spending, infrastructure. |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0767&r=pol |
| By: | Gradstein, M. |
| Abstract: | This paper's point of departure is that low-quality institutions, concentration of political power, and underdevelopment are persistent over time. Its analytical model views an equal distribution of political power as a commitment device to enhance institutional quality thereby promoting growth. The politically powerful coalition contemplates relinquishing of its power, weighing this advantageous consequence against the limit on own appropriative ability that it entails. The possibility of two developmental paths is exhibited: with concentration of political and economic power, low-quality institutions, and slow growth; and a more equal distribution of political and economic resources, high-quality institutions, and faster growth. |
| Keywords: | Institutional quality, inequality, political bias, growth. |
| JEL: | D31 D72 O10 O11 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0769&r=pol |
| By: | Eric Brunner (Quinnipiac University); Stephen L. Ross (University of Connecticut); Ebonya Washington (Yale University) |
| Abstract: | There is a large literature demonstrating that positive economic conditions increase support for incumbent candidates, but little understanding of how economic conditions affect preferences for parties and for particulars of their platforms. We ask how exogenous shifts to the value of residentsÇ human capital affect voting behavior in California neighborhoods. As predicted by economic theory, we find that positive economic shocks decrease support for redistributive policies. More notably, we find that conservative voting on a wide variety of ballot propositions--from crime to gambling to campaign finance--is increasing in economic well being. We further show that positive economic circumstances decrease turnout and have a mixed impact on candidate choice, highlighting a limitation of inferring policy preferences from party choice. |
| Keywords: | Voting, Employment, Taxes, Expenditures |
| JEL: | D72 H0 |
| Date: | 2008–06 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2008-18&r=pol |
| By: | Andrew Leigh |
| Abstract: | Which electorates receive targeted funding, and does targeted funding swing votes? To answer these questions, I analyze four discretionary programs funded by the Australian federal government during the 2001-2004 election cycle. Controlling for relevant demographic characteristics of the electorate, those electorates held by the governing coalition received a larger share of discretionary funding, and a larger number of program grants. Among government seats, funding does not appear to have been directed towards those that were more marginal. More discretionary funding – particularly on road-building – was associated with a larger swing towards the government in the 2004 election. |
| Keywords: | elections, local expenditure, voting, targeted funding, pork barreling |
| JEL: | D72 R58 |
| Date: | 2008–05 |
| URL: | http://d.repec.org/n?u=RePEc:auu:dpaper:580&r=pol |
| By: | Dalgaard, C.; Olsson, O. |
| Abstract: | The present paper documents that political stability is positively associated with the extent of domestic trade. In explaining this regularity, we provide a model where political cohesion is linked to the emergence of a fully functioning market economy. Without market exchange, the welfare of inherently selfish individuals will be mutually independent. As a result, political negotiations, echoing the preferences of the citizens of society, will be dog-eat-dog in nature. Whoever has greater bargaining power will be willing to make decisions that enhance the productivity of his supporters at the expense of other groups in society. If the gains from specialization become sufficiently large, however, a market economy will emerge. From being essentially non-cooperative under self-sufficiency, the political decision making process becomes cooperative in the market economy, as the welfare of individuals will be mutually interdependent due to the exchange of good. |
| Keywords: | Political cohesion, Economic growth |
| JEL: | P16 O41 |
| Date: | 2007–10 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0765&r=pol |
| By: | Graziella Bertocchi (-) |
| Abstract: | We offer a rationale for the decision to extend the franchise to women within a politico-economic model where men are richer than women, women display a higher preference for public goods, and women’s disenfranchisement carries a societal cost. We first derive the tax rate chosen by the male median voter when women are disenfranchised. Next we show that, as industrialization raises the reward to mental labor relative to physical labor, women’s relative wage increases. When the cost of disenfranchisement becomes higher than the cost of the higher tax rate which applies under universal enfranchisement, the male median voter is better off extending the franchise to women. A consequent expansion of the size of government is only to be expected in societies with a relatively high cost of disenfranchisement. We empirically test the implications of the model over the 1870-1930 period. We proxy the gender wage gap with the level of per capita income and the cost of disenfranchisement with the presence of Catholicism, which is associated with a more traditional view of women’s role and thus a lower cost. The gender gap in the preferences for public goods is proxied by the availability of divorce, which implies marital instability and a more vulnerable economic position for women. Consistently with the model’s predictions, women suffrage is affected positively by per capita income and negatively by the presence of Catholicism and the availability of divorce, while women suffrage increases the size of government only in non-Catholic countries. |
| Keywords: | women suffrage, inequality, public goods, welfare state, culture, family, divorce |
| JEL: | P16 J16 N40 H50 |
| Date: | 2008–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:prt:dpaper:4_2008&r=pol |
| By: | Karin Mayr (Department of Economics, Johannes Kepler University Linz, Austria) |
| Abstract: | Sectoral labor supply shortage is a cause of concern in many OECD countries and has raised support for immigration as a potential remedy. In this paper, we derive a general equilibrium model with overlapping generations, where natives require a compensating wage differential for working in one sector rather than in another. We identify price and wage effects of immigration on three different groups of natives: the young working in one of two sectors and the old. We determine the outcome of a majority vote on immigration into a given sector as well as the social optimum. The main findings are that i) the old determine the majority voting outcome of positive immigration into both sectors, if natives are not mobile across sectors, ii) the young determine the majority voting outcome of zero immigration into both sectors, if natives are mobile across sectors, iii) the social optimum is smaller than or equal to the majority voting outcome, and iv) sector-specific immigration is not always a substitute for native mobility across sectors. |
| Keywords: | immigration, political economy, welfare, sectoral mobility |
| JEL: | F22 J31 J61 |
| Date: | 2008–05 |
| URL: | http://d.repec.org/n?u=RePEc:jku:econwp:2008_07&r=pol |
| By: | Otto H. Swank; Bauke Visser |
| Abstract: | Transparent decision-making processes are widely regarded as a prerequisite for the working of a representative democracy. It facilitates accountability, and citizens may suspect that decisions, if taken behind closed doors, do not promote their interests. Why else the secrecy? We provide a model of committee decision-making that explains the public.s demand for transparency, and committee members. aversion to it. In line with case study evidence, we show how pressures to become transparent induce committee members to organize pre-meetings away from the public eye. Outcomes of pre-meetings, deals, are less determined, more anarchic, than those of formal meetings, but within bounds. We characterize deals that are self-enforcing in the formal meeting. |
| Keywords: | Committee decision-making, reputational concerns, transparency, pre-meetings, deliberation, self-enforcing deals, coalitions |
| JEL: | D71 D72 D82 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:eui:euiwps:eco2008/18&r=pol |
| By: | Ben Crum |
| Abstract: | This paper proposes to assess the representative quality of European Union decision-making by way of a micro-approach which traces the effectiveness of the mechanisms of representation that connect the European peoples to the decision-making process. In particular, it proposes to distinguish systematically between ‘upstream’ controls that delimit the mandate of political representatives and ‘downstream’ controls that allow political representatives to justify their decisions through deliberation. This approach is applied to the various phases of the making of the EU Constitutional Treaty and its dramatic failure due to the negative referendum verdicts in France and the Netherlands. Thus it is demonstrated that the EU Constitutional process has suffered from a lack of mechanisms for aligning politicians with public opinion. In particular, ‘upstream’ controls fell short in the very conception of the process in the 2001 Laeken Declaration and in the negotiations in the Intergovernmental Conference. On the other hand, ‘downstream’ controls remained under-activated in the European Convention and came too late in the ratification phase. Thus the Laeken process emerges as a process involving drifting political elites that, once brought face to face with their democratic principals again, failed to convincingly justify their actions. As the superimposition of the various phases had the overall effect of blurring all lines of political control and accountability over the process, it was eventually to the people to pull the emergency brake to prevent its outcome from taking effect. |
| Keywords: | European Council; political representation; intergovernmental conferences; deliberative democracy; legitimacy; European Convention |
| Date: | 2008–06–15 |
| URL: | http://d.repec.org/n?u=RePEc:erp:reconx:p0027&r=pol |
| By: | Congleton, R.D. |
| Abstract: | Constitutional democracy in the United States emerged very gradually through a long series of constitutional bargains in the course of three centuries. No revolutions or revolutionary threats were necessary or evident during most of the three century–long transition to constitutional democracy in America. As in Europe, legislative authority gradually increased, wealth-based suffrage laws were gradually eliminated, the secret ballot was introduced, and the power of elected officials increased. For the most part, this occurred peacefully and lawfully, with few instances of open warfare or revolutionary threats. A theory of constitutional exchange grounded in rational choice models provides a good explanation for the distinctive features of American constitutional history, as it does for much of the West, although it does less well at explaining the timing of some changes. |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0764&r=pol |