nep-pol New Economics Papers
on Positive Political Economics
Issue of 2010‒10‒09
sixteen papers chosen by
Eugene Beaulieu
University of Calgary

  1. A Dynamic Politico-Economic Model of Intergenerational Contracts By Francesco Lancia; Alessia Russo
  2. Gender inequality in education: Political institutions or culture and religion? By Arusha Cooray; Niklas Potrafke
  3. The quality of democracy in the Czech Republic By Zdenka Mansfeldová; Petra Rakušanová Guasti
  4. How are they spending my taxes? Tax compliance and citizens’ interest in politics By Dawson, Peter; Jones, Philip
  5. Political Factors and Health Outcomes: Insight from Argentina's Provinces By James W. McGuire
  6. Strategic Party Formation on a Circle By Peeters Ronald; Saran Rene; Yuksel Ayse Muge
  7. The Political Economy of Attracting Public Funds: The Case of Lebanon By Nisreen Salti; Jad Chaaban
  8. An experimental test of prejudice about foreign people By Pablo Brañas-Garza; Olusegun A. Oyediran; M.Fernanda Rivas
  9. The Politics of Financial Development: The Role of Interest Groups and Government Capabilities By Oscar Becerra; Eduardo Cavallo; Carlos Scartascini
  10. Nicaraguan civil society caught in the pendulum's swing? Shifting roles from service delivery to lobbying and back By Pinyol Puig, Gemma; Molenaers, Nadia; Cepinskas, Linus
  11. Overcoming Ideological Bias in Elections By Vijay Krishna; John Morgan
  12. Who is Anti-American in the European Union? By Lawson, Colin W.; Hudson, John
  13. On Removing the Condorcet Influence from Pairwise Elections Data By Chandra, Abhijit; Roy, Sunanda
  14. Between an intergovernmental and a polycentric European Union: National parliamentary discourses on democracy in the EU ratification process By Aleksandra Maatsch
  15. What Makes Persistent Identifiers Persistent? By Nikos Askitas
  16. Do we agree? Measuring the cohesiveness of preferences By Jorge Alcalde-Unzu; Marc Vorsatz

  1. By: Francesco Lancia; Alessia Russo
    Abstract: This paper investigates the conditions for the emergence of implicit intergenerational contracts without assuming reputation mechanisms, commitment technology and altruism. We present a tractable dynamic politico-economic model in OLG environment where politicians play Markovian strategies in a probabilistic voting environment, setting multidimensional political agenda. Both backward and forward intergenerational transfers, respectively in the form of pension benefits and higher education investments, are simultaneously considered in an endogenous human capital setting with labor income taxation. On one hand, social security sustains investment in public education; on the other hand investment in education creates a dynamic linkage across periods through both human and physical capital driving the economy toward di¤erent Welfare State Regimes. Embedding a repeated-voting setup of electoral competition, we find that in a dynamic efficient economy both forward and backward intergenerational transfers simultaneously arise. The equilibrium allocation is education efficient, but, due to political overrepresentation of elderly agents, the electoral competition process induces overtaxation compared with a Benevolent Government solution with balanced welfare weights.
    Keywords: aging, Benevolent Government allocation, intergenerational redistribution, Markovian equilibria, repeated voting;
    JEL: C61 D71 E62 H11
    Date: 2010–09
  2. By: Arusha Cooray (School of Economics, University of Wollongong); Niklas Potrafke (Department of Economics, University of Konstanz, Germany)
    Abstract: We investigate empirically whether political institutions or culture and religion underlie gender inequality in education. The dataset contains up to 157 countries over the 1991-2006 period. The results indicate that political institutions do not significantly influence education of girls: autocratic regimes do not discriminate against girls in denying educational opportunities and democracies do not discriminate by gender when providing educational opportunities. The primary influences on gender inequality in education are culture and religion. Discrimination against girls is especially pronounced in Muslim dominated countries.
    Keywords: Gender discrimination, education, democracy, religion
    JEL: O11 O15 O43 O57 P26 P36 Z12
    Date: 2010–07–13
  3. By: Zdenka Mansfeldová; Petra Rakušanová Guasti
    Keywords: benchmarking; Czech Republic; democracy; governance; methodological issues; participation; political science
    Date: 2010–08–15
  4. By: Dawson, Peter; Jones, Philip
    Abstract: In neoclassical economics, individuals are assumed to perceive tax payments as commensurate with any other payment. This paper challenges this assumption. Individuals are more likely to identify with the community when they pay a higher share of their income in tax and when compliance is also an expression of civic duty. An analysis of questionnaire responses from over 20 countries suggests that citizens take a greater interest in politics when they are more tax compliant.
    Keywords: tax evasion; information; political participation
    Date: 2010–09
  5. By: James W. McGuire (Department of Government at Wesleyan University)
    Abstract: This paper explores whether political factors were associated with health outcomes across Argentina's 23 provinces and Federal Capital from 1983 to 2005, controlling for national trends, per capita economic output, and other provincial specificities. The introduction of a gender quota for the lower house of the provincial legislature is found to have a statistically significant and substantively strong association with lower infant mortality. Most other political factors are found to be unassociated with the health share of provincial spending, attendance at birth by trained personnel, or infant survival. This lack of association stands in contrast to the findings of the cross-national literature, in which political factors are often found to be associated with health care spending, health service utilization, and health status. Differences in level of analysis (national vs. subnational) and in statistical technique help to explain these contrasting findings. Still, the analysis suggests that relations between political factors and health outcomes may be weaker than is sometimes suggested. As Amartya Sen has noted, democratic freedoms (and other political factors) create opportunities to improve other dimensions of human development. Whether these opportunities are seized depends on the actions of citizens and governments.
    Keywords: human development, democracy, mortality, health care, gender, subnational, Argentina.
    JEL: O15 N46 I12 I18 J16 H51 O54
    Date: 2010–09
  6. By: Peeters Ronald; Saran Rene; Yuksel Ayse Muge (METEOR)
    Abstract: We study a spatial model of party formation in which the set of agendas is the unit circle. We characterize the sets of pure-strategy Nash equilibria under the plurality and proportional rules. In both rules, multiple configurations of parties are possible in Nash equilibrium. We refine our predictions using a new notion called “defection-proof” Nash equilibrium. Under the plurality rule, only those Nash equilibria in which either two or three parties exist are defection-proof, whereas multiple parties exist in any defectionproof Nash equilibrium under the proportional rule. These results are mostly consistent with the predictions of Duverger (1954).Keywords: Party Formation; Spatial Model; Plurality Rule; Proportional Rule; Nash Equilibrium; Defection-Proof Nash Equilibrium.
    Keywords: microeconomics ;
    Date: 2010
  7. By: Nisreen Salti (Department of Economics, American University of Beirut); Jad Chaaban
    Abstract: Using a new exceptional dataset on 80 poverty pockets in Lebanon in 2004, we propose to test the confessional and political channels of influence through which these pockets are potentially able to attract development assistance. Lebanon constitutes a perfect case study for the interaction of identity-based polarization and fractionalization (based on confession) and poverty in the context of a developing country. We investigate the effect on the level of development assistance funds transferred to municipal governments of polarization, fractionalization and sectarian distance at the level of the poverty pockets and find robust results indicating that polarization and fractionalization are significant determinants of a pocket’s ability to attract funding. We also find that one of our measures of sectarian distance, the share in the larger district of a poverty pocket’s largest sect, also generates more revenue for the pocket. Pockets with a mix of sects have greater ease in attracting funds, which is consistent with the prerogative of confessional balance in government policy dictated by the power-sharing game in the post-war era. The results are robust to the inclusion of a wide variety of controls. They put into question the design of effective channels to allocate development funds in polarized societies.
    Date: 2010–09
  8. By: Pablo Brañas-Garza (Department of Economic Theory and Economic History, University of Granada.); Olusegun A. Oyediran (Department of Economic Theory and Economic History, University of Granada.); M.Fernanda Rivas (University of Granada.)
    Abstract: This paper o¤ers two related issues: (i ) an applications of beliefs about the cooperative behavior of others to policy-oriented issues, (ii ) a method of explor- ing prejudices (toward others) where interviewees are oblivious of its purpose. We studied contributions and guesses about others?contributions through an experimental game. Prejudice is examined as an implicitly held belief by a Spanish college student towards any of the speci?ed foreign population groups (i.e. the Asians, the Africans, the Latin Americans and the Westerners). The results show that: at the individual level, there exists some subjects that harbor strong positive (and negative) prejudices toward the foreigners. The prejudice models ?tted also show that: own contributions, femaleness, individual wealth; and beliefs about income status, cultural status, religious intensity, societal co- operation and political orientation have strong in?uences on racial prejudice.
    Keywords: Beliefs, Prejudice, Public Goods Game
    Date: 2010–08–01
  9. By: Oscar Becerra; Eduardo Cavallo; Carlos Scartascini
    Abstract: Although financial development is good for long-term growth, not all countries pursue policies that render full financial development. This paper builds on an extensive political economy literature to construct a theoretical model showing that the intensity of opposition to financial development by incumbents depends on both their degree of credit dependency and the role of governments in credit markets. Empirical evidence for this claim is provided, and the results suggest that lower opposition to financial development leads to an effective increase in credit markets’ development only in those countries that have high government capabilities. Moreover, improvements in government capabilities have a significant impact on credit market development only in those countries where credit dependency is high (thus, opposition is low). This paper therefore contributes to this rich literature by providing a unified account of credit market development that includes two of its main determinants, traditionally considered in isolation.
    Keywords: Financial development, Interest groups, Political economy, Government capabilities
    JEL: G10 G18 G20 G38 O16 D72
    Date: 2010–09
  10. By: Pinyol Puig, Gemma; Molenaers, Nadia; Cepinskas, Linus
    Abstract: Until the end of the 1990s, Nicaragua was marked with social conflict and internal political struggles. From 2000 until 2006 Nicaragua experienced a relatively democratic period, in which the country drafted Poverty Reduction Strategy Papers (PRSPs) with participation of the civil society. In this period, the openness of the political system and the participatory dimension of the PRSPs helped to strengthen civil society and increase policy influencing. As a result a shift took place away from service delivery and towards more lobbying and advocacy. The election of Ortega in 2006 (Sandinista National Liberation Front (FSLN)) as president introduced the shrinking of this democratic space. From that moment onwards, donors encountered difficulties in dealing with the participation conditionality. At the same time, civil society organizations (CSOs) found it difficult to counterbalance the increasing undemocratic tendencies despite their efforts to organize mobilizations. This paper argues that the NAA, which pushes civil society into the watchdog role, is rather troublesome in contexts which are politically closing down. Imposing the single role of watchdog on civil society is ineffective. The NAA should not be treated as a rigid blueprint but, rather, as a guideline for policy implementation dependent on the actual situation in the country of concern.
    Date: 2010
  11. By: Vijay Krishna; John Morgan
    Date: 2010–09–28
  12. By: Lawson, Colin W.; Hudson, John
    Abstract: The term anti-Americanism has become common in public and academic debate in the last decade. Yet we have only limited knowledge of those who hold such views. From 2003, 2005 and 2006 Eurobarometer data, almost 20% of EU respondents disapproved of USA policy in all five dimensions the surveys examined. Following the literature, this consistent opposition is defined as anti-American. Anti-Americans exhibit systematic differences in age, education, geographical location, policy preferences and nationality. In addition although anti-Americanism is associated with a preference for greater European independence, perhaps surprisingly it is also linked to a desire for a less federal and hence less powerful Europe. In both sets of attitudes, to the USA and to the EU, there is also a strong regional dimension within countries, which reinforces the view that it is too simplistic to describe a country as being anti-American or being pro European integration.
    Date: 2010–09
  13. By: Chandra, Abhijit; Roy, Sunanda
    Date: 2010–09–28
  14. By: Aleksandra Maatsch
    Abstract: The paper analyses national parliamentary plenary debates on the Constitutional and the Lisbon Treaty in the six European states; Germany, France, Great Britain, Poland, Hungary and the Czech Republic. The comparative qualitative and quantitative discourse analysis of the plenary debates presents the patterns of support and rejection of the Treaties in the analysed states. The findings of the paper confirm the existing thesis that the left-right and TAN-GAL dimensions explain support for the Treaties. However, the paper also demonstrates that in this case the opposition moved towards the political centre represented by the mainstream conservative and Christian-democratic parties that until now counted among supporters of the European integration. The second factor identified in this paper as accounting for support or rejection of the Treaties was membership in the government: governing parties, also the conservative ones, were more likely to overcome internal opposition in order to ratify the Treaty. Regarding democracy models, the opponents of the Treaties were in favour of the polycentric European Union, whilst the opponents favoured the intergovernmental model. The federal model of the European Union was present in the parliamentary debates, however, it received only negative evaluations. The cosmopolitan model was entirely absent in the discussions.
    Keywords: Constitution for Europe; democracy; national parliaments
    Date: 2010–09–15
  15. By: Nikos Askitas
    Abstract: This essay sketches technical and non-technical issues around persistent identifiers (henceforth PIs) in a manner which makes no attempt to be complete. Our goal is to rescue the core notions from the obscurity which detail and completeness burdens them with. A reader willing to entertain the idea of their necessity should be able to cut to the chase and follow a more complex and involved debate after reading this. Our hope is that in isolating the core issues we will enable a more founded discussion of the social and political issues involved in PIs.
    Keywords: Persistent Identifier, handle, DOI, data, trust, URN, RePEc
    Date: 2010
  16. By: Jorge Alcalde-Unzu; Marc Vorsatz
    Abstract: In this paper, we suggest new ways of how to measure the similarity of preferences in a group of individuals. For simplicity, we refer to this as the cohesiveness (of preferences). We propose axioms a cohesiveness measure should satisfy and show that these properties fully characterize a family of measures. According to it, the similarities between each pair of objects in a preference profile -calculated as the proportion margin by which one objects wins against the other in a pairwise comparison- are aggregated by a weighted mean. The weight of each pair of objects depends on their importance at the social level
    Date: 2010–09

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