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on Positive Political Economics |
| By: | Battaglini, Marco; Nunnari, Salvatore; Palfrey, Thomas |
| Abstract: | We present a legislative bargaining model of the provision of a durable public good over an infinite horizion. In each period, there is a societal endowment which can either be invested in the public good or consumed. We characterize the optimal public policy, defined by the time path of investment and consumption. In each period, a legislature with presentatives of each of n districts bargain over the current period's endowment for investment in the public good and transfers to each district. We analyze the Markov perfect equilibrium under different voting q-rules where q is the number of yes votes required for passage. We show that the efficiency of the public policy is increasing in q because higher q leads to higher investment in the public good and less pork. We examine the theoretical equilibrium predictions by conducting a laboratory experiment with fiveperson committees that compares three alternative voting rules: unanimity (q=5); majority (q=3); and dictatorship (q=1). -- |
| Keywords: | dynamic political economy,voting,public goods,bargaining,experiments |
| JEL: | D71 D72 C78 C92 H41 H54 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wzbmbh:spii2011205&r=pol |
| By: | Sylvain Dessy; Stéphane Pallage; Désiré Vencatachellum |
| Abstract: | We build a political economy model of state policy choice highlighting the challenges to breaking barriers to the adoption of inclusive policies in Africa. We highlight necessary and sufficient conditions for a political leader to gain from implementing exclusive policies: (i) Implementing inclusive policies must be risky; (ii) the political leader must have adequate access to an overseas’ financial safe haven as a technology for protecting the spoils from implementing exclusive policies, or investing the looted funds in the domestic economy must sufficiently contribute to mitigate the risk of a revolution. Our results suggest that breaking barriers to inclusive policies in Africa is not an easy task. Bans on international money-laundering schemes may not be sufficient if domestic money laundering is easy and sufficiently discrete. |
| Keywords: | Inclusive policies, social exclusion, rebellion, financial safe havens, development |
| JEL: | D70 D74 H50 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:lvl:lacicr:1202&r=pol |
| By: | Kuperman, Ranan (University of Haifa) |
| Abstract: | This research investigates how students of political science playing the role of a state leader cope with structural and dynamic complexities of international conflict. This was studied with the aid of an interactive microworld simulator of a fishing dispute, which was designed according to principles of system dynamics. The research question was what type of decision-making patterns characterized subjects who adapted successfully to the challenges posed by the opponent in comparison to subjects who pursued policies that produced suboptimal payoffs. The results of this research suggest two reasons for poor adaptation. First, rather than exploring the consequences of all possible policy options, most subjects had very strong pre-existing policy preferences and were reluctant to abandon them in favor of alternative policies. Second, many subjects did not adequately analyze the statistical data that were required in order to estimate the payoffs. A third possibility that was explored but not sufficiently supported is that decisions were based on satisficing rather than comparing utilities associated with alternative policies. |
| Keywords: | policy preferences; decision making; international conflicts |
| JEL: | D74 |
| Date: | 2011–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:nepswp:2011_003&r=pol |