nep-pol New Economics Papers
on Positive Political Economics
Issue of 2010‒08‒21
seven papers chosen by
Eugene Beaulieu
University of Calgary

  1. District Magnitude and Representation of the Majority’s Preferences: Quasi-Experimental Evidence from Popular and Parliamentary Votes By Marco Portmann; David Stadelmann; Reiner Eichenberger
  2. The Army, UN Peacekeeping Mission and Democracy in Bangladesh. By Islam, Nurul
  3. Interaction Between Trade, Conflict And Cooperation: The Case Of Japan And China By Shiro Armstrong
  4. Near Is My Shirt but Nearer Is My Skin. Ideology or Self-Interest as Determinants of Public Opinion on Fiscal Policy Issues By Hans Pitlik; Gerhard Schwarz; Barbara Bechter; Bernd Brandl
  5. Lying in Business: Insights from Hannah Arendt’s ‘Lying in Politics’ By Eenkhoorn, P.; Einmahl, J.H.J.
  6. Social Image in Public Goods Provision with Real Effort By Emel Filiz-Ozbay; Erkut Y. Ozbay
  7. Government size and trust By Eiji Yamamura

  1. By: Marco Portmann; David Stadelmann; Reiner Eichenberger
    Abstract: Members of parliament have more effective incentives to cater for the majority’s preferences when they are elected in districts with few seats in parliament rather than in districts with many seats. We empirically investigate this hypothesis by matching voting behavior on legislative proposals of Swiss members of parliament with real referenda outcomes on the same issues for the years 1996 to 2008. This quasi-experimental data allows us to identify the impact of electoral systems through district magnitude on how members of parliament represent citizens’ preferences. We find systematic, statistically significant and economically relevant evidence that members of parliament from districts with few seats vote along the majority’s preferences.
    Keywords: Median Voter, Political Economy, Electoral Systems
    JEL: D72 D70 H00
    Date: 2010–08
  2. By: Islam, Nurul
    Abstract: This article examines the role of the United Nations peacekeeping mission in Bangladesh in pushing the army in a certain direction with regard to holding elections and supporting political parties. It analyses the reasons why the UN peacekeeping mission has such a strong influence on the Bangladesh army and assesses the implications for future political developments of such foreign involvement. It further argues that whatever the limitations and excesses of democracy, army rule is no solution, rather it is necessary to strengthen democractic institutions and let democratic processes play themselves out. In this sense, the recourse to the army to bring in democracy in Bangladesh was not the best solution to the political impasse witnessed in 2007.
    Keywords: Bangladesh; UN Peacekeeping
    JEL: H0
    Date: 2010
  3. By: Shiro Armstrong
    Abstract: The complex interaction between trade and politics is analysed for the Japan-China relationship using Granger causality tests. The purpose is to determine the presence and direction of causation between trade and political events, both positive and negative, and to gauge an idea of the lag length of causality. Trade is growing quickly between Japan and China despite long standing political distance between the two countries. Results show that the economic relationship underpins and constrains the political relationship between Japan and China while an increase in positive political news and a decrease in negative political news promote trade to some degree.
    JEL: C32 F10 F59
    Date: 2010
  4. By: Hans Pitlik (WIFO); Gerhard Schwarz (Austrian Institute of Economic Research); Barbara Bechter; Bernd Brandl (University of Vienna, Department of Industrial Sociology)
    Abstract: Several empirical studies derive that personal positions with respect to policy measures are dominated by ideology instead of narrow self-interest. In the present field study we carried out a telephone survey with 1,003 respondents all over Austria. Instead of measuring selfishness indirectly by using more or less "objective indicators" for self-interest, we requested respondents to assess directly whether they expect to be affected by policy measures. Our results indicate that such a subjectively measured narrow self-interest explains attitudes towards economic policies at least as good as ideological conviction. In some cases ideology appears to determine whether people feel affected by a proposed policy measure.
    Date: 2010–06–30
  5. By: Eenkhoorn, P.; Einmahl, J.H.J. (Tilburg University, Center for Economic Research)
    Abstract: The famous political philosopher Hannah Arendt develops several arguments why truthfulness cannot be counted among the political virtues. This article shows that similar arguments apply to lying in business. Based on Hannah Arendt’s theory, we distinguish five reasons why lying is a structural temptation in business: business is about action to change the world and therefore businessmen need the capacity to deny current reality; commerce requires successful image-making and liars have the advantage to come up with plausible stories; business communication is more often about opinions than about facts, giving leeway to ignore uncomfortable signals; business increasingly makes use of plans and models, but these techniques foster inflexibility in acknowledging the real facts; businessmen fall easily prey to self-deception, because one needs to act as if the vision already materializes. The theory is illustrated by a case study of Landis that grew from a relative insignificant into a large organization within a short period of time, but ended with outright lies and bankruptcy.
    Keywords: Lying;deceit in business;Hannah Arendt;image-making;self-deception;accounting fraud;politics and business;Landis
    JEL: D89 M14 M41
    Date: 2010
  6. By: Emel Filiz-Ozbay (University of Maryland); Erkut Y. Ozbay (University of Maryland)
    Abstract: We study public goods game where the contribution efforts are observable. When the players are observed, they contribute more and free-riding diminishes significantly. On the other hand, presence of an audience does not affect the performance of players if there is no strategic aspect of the game, i.e. when they play private goods game. The findings are in line with the predictions of the social image theory where a player’s contribution is also a signal to an audience regarding how much she cares about contributing to the public goods.
    Keywords: Conditional CAPM
    Date: 2010–08
  7. By: Eiji Yamamura
    Abstract: This paper uses individual level data (the Japanese General Social Survey, 2001) to examine how government size influences generalized trust. After controlling for income inequality, population mobility, city size and various individual characteristics, I found: (1) Using all samples, government size is not associated with generalized trust, and (2) After splitting the sample into worker and non-worker samples, government size does not influence generalized trust for non-workers whereas it significantly reduces generalized trust for workers. This suggests that workers, through their work experience, might confront the greater bureaucratic red tape coming from “larger government”, leading to negative externality effects on the trustful relationship in the labor market.
    Keywords: Government size; Generalized trust.
    JEL: D30 Z13
    Date: 2010–06–06

This nep-pol issue is ©2010 by Eugene Beaulieu. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.