nep-pol New Economics Papers
on Positive Political Economics
Issue of 2010‒08‒14
four papers chosen by
Eugene Beaulieu
University of Calgary

  1. Democracy and Consumer Strength: Direct Evidence from Regulatory Reform in Developing Countries By Weymouth, Stephen
  2. Government Purchases Over the Business Cycle: the Role of Economic and Political Inequality By Ruediger Bachmann; Jinhui Bai
  3. Attitudes toward immigrants in Luxembourg - Do contacts matter? By VALENTOVA Marie; BERZOSA Guayarmina
  4. Immigration as a Threat: The Effect of Gender Differences Among Luxembourg Residents with and without a Migration History By VALENTOVA Marie; ALIEVA Aigul

  1. By: Weymouth, Stephen
    Abstract: The distributional implications of antitrust regulation imply a political cleavage between consumers and producers. I argue that the relative strength of these two groups depends on the level of democracy. In particular, an expansion of the franchise and competitive elections will increase the relative political weight of consumers, resulting in policies that favors their interests. An empirical implication of the argument is that the likelihood of effective competition policy reform increases with democracy. I test this proposition in two stages using an original dataset measuring competition agency design in 156 developing countries covering the period 1975-2007. First, I estimate hazard models on the timing of competition policy reform. Second, since “laws on the books” do not necessarily indicate a commitment to effective policy, I create an original index measuring governments’ commitments to antitrust policy. The index captures the independence of the agency, resource (budget and staffing) allocations, expert perceptions, and actual legal actions. The results of the empirical analysis support the proposition that democracy improves governments’ commitments to competition policy.
    Date: 2010–06
  2. By: Ruediger Bachmann; Jinhui Bai
    Abstract: This paper explores the implications of economic and political inequality for the business cycle comovement of government purchases. We set up and compute a heterogeneous-agent neoclassical growth model, where households value government purchases which are financed by income taxes. A key feature of the model is a wealth bias in the political aggregation process. When calibrated to U.S. wealth inequality and exposed to aggregate productivity shocks, such a model is able to generate milder procyclicality of government purchases than models with no political wealth bias. The degree of wealth bias that matches the observed mild procyclicality of government purchases in the data, is consistent with cross-sectional data on political participation.
    JEL: E30 E32 E60 E62 H30
    Date: 2010–08
  3. By: VALENTOVA Marie; BERZOSA Guayarmina
    Abstract: According to the latest official statistics, the number of immigrants in Luxembourg is approaching half the population. This demographic change raises questions concerning social inclusion, social cohesion, and intergroup conflicts. The present paper contributes to this discussion by analyzing attitudes toward immigrants and their determinants. Controlling for key socio-demographic and economic individual characteristics, we focus specifically on examining how the intensity of core contacts between nationals and inhabitants with migratory background affects attitudes toward immigrants among three groups of Luxembourg residents: natives, first-generation immigrants, and second-generation immigrants. The European Values Study data of 2008 was used in the paper. The results indicate that attitudes toward immigrants depend significantly on the origins of the residents of Luxembourg. Nationals adopt the most negative stance toward immigrants; they are followed by second-generation and first-generation immigrants. Attitudes of second-generation immigrants are closer to those of the native population than to those of first-generation immigrants, which confirms the assimilation hypotheses. Core contacts appear to play the most important role in the case of first-generation immigrants. The more connected the first-generation migrant to the native population, the more negative his/her opinion of immigrants.
    Keywords: attitudes toward immigrants; contact theory; migratory background; EVS
    Date: 2010–07
  4. By: VALENTOVA Marie; ALIEVA Aigul
    Abstract: Anti-immigration sentiments have been extensively studied in recent years. Empirical studies showed that the out-group size together with the general economic condition of the host country determines the extent and the intensity of the anti-immigrant perception. While nearly all studies concluded that men and women differ in their perceptions, there is no explanation for this behaviour. Gender differences were the main focus of this paper, and we looked at two related issues. First, in our analysis, we sought a more detailed explanation of the particular reasons that foster this negative perception. Secondly, while the majority of studies focused exclusively on perceptions of the native population, we included the perceptions of the non-native populations separately and looked at the differences among three groups, with gender being the primary focus both between and within groups. We found that both gender and immigration history mediates the threat perception in Luxembourg.
    Keywords: gender; threat; attitudes; immigration; EVS
    JEL: I39 J15 J16
    Date: 2010–07

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