nep-pol New Economics Papers
on Positive Political Economics
Issue of 2013‒05‒05
five papers chosen by
Eugene Beaulieu
University of Calgary

  1. The effect of remittances prior to an election By Jean-Louis COMBES; Christian EBEKE; Mathilde MAUREL
  2. How Do Voters Respond to Information? Evidence from a Randomized Campaign By Chad Kendall; Tommaso Nannicini; Francesco Trebbi
  4. What Do Parties Do in Congress? Explaining the Allocation of Legislative Specialization By Ponce, Aldo F
  5. Freedom, Ratings and Economic Growth: In Search of Reliable Dependencies By Konstantin Yanovsky; Rinat Menyashev

  1. By: Jean-Louis COMBES; Christian EBEKE; Mathilde MAUREL
    Abstract: This paper focuses on the relationships between remittances, elections, and government consumption as a percentage of GDP. We combine data from the National Elections across Democracy and Autocracy (NELDA) dataset compiled and discussed in Hyde and Marinov (2012) and the World Development Indicators dataset. We focus on 70 young democracies in the developing world. The period under investigation is 1990-2010. The main objective of the paper is to assess whether remittances have an influence on the political manipulation, which may occur prior to an election, through in increase in the government consumption-to-GDP-ratio. It appears that remittances dampen the political business cycle (PBC). Furthermore, the PBC is reduced up to the point where it is fully cancelled out at a remittance threshold of 10.7 percent of GDP. Those findings are robust to different econometric strategies and robustness checks.
    Keywords: Political Business Cycles, Remittances
    JEL: F2 F22 O15
    Date: 2013
  2. By: Chad Kendall; Tommaso Nannicini; Francesco Trebbi
    Abstract: Rational voters update their subjective beliefs about candidates’ attributes with the arrival of information, and subsequently base their votes on these beliefs. Information accrual is, however, endogenous to voters’ types and difficult to identify in observational studies. In a large scale randomized trial conducted during an actual mayoral campaign in Italy, we expose different areas of the polity to controlled informational treatments about the valence and ideology of the incumbent through verifiable informative messages sent by the incumbent reelection campaign. Our treatments affect both actual vote shares at the precinct level and vote declarations at the individual level. We explicitly investigate the process of belief updating by comparing the elicited priors and posteriors of voters, finding heterogeneous responses to information. Based on the elicited beliefs, we are able to structurally assess the relative weights voters place upon a candidate’s valence and ideology. We find that both valence and ideological messages affect the first and second moments of the belief distribution, but only campaigning on valence brings more votes to the incumbent. With respect to ideology, cross-learning occurs, as voters who receive information about the incumbent also update their beliefs about the opponent. Finally, we illustrate how to perform counterfactual campaigns based upon the structural model.
    JEL: H1 H7
    Date: 2013–04
  3. By: Konstantin Yanovsky (Gaidar Institute for Economic Policy); Sergey Shulgin (Russian Presidential Academy of National Economy and Public Administration)
    Abstract: In this paper we tested the hypothesis of the "political" basis for the "economic" rights. We constructed our own variables of political regimes' classification for years 1820-2000. We found significant positive interdependencies between the Democracy's indicators and Economic Growth. Protection of the Private property rights requires, first and foremost, due guaranties for the personal immunity as a key precondition. Power to arrest discretionary undermines any formal guaranties of private property, low taxation benefits etc. Personal immunity should be defended even for "unpleasant" person (say, H. Ford or W. Gates) or for the chieftains' challengers (to make "rights of the meanest … respectable to the greatest"). It means the free speech; religious freedom and other "political rights" should be respected. Democracy, as political competition system weakens governments' power to break personal freedoms and property rights.
    Keywords: Rule of Law, Rule of Force, Personal Rights, Private Property Protection, Economic Growth
    JEL: P16 P50 N40 O43
    Date: 2012
  4. By: Ponce, Aldo F
    Abstract: This article studies the determinants of the concentration of legislative specialization of parties across policy jurisdictions. Greater concentration of legislative specialization leads parties to concentrate their legislative efforts on a smaller set of policy jurisdictions. Through enhancing their concentration of legislative specialization in certain policy areas, parties can more clearly signal their policy concerns and interests to voters. This study argues and shows that relatively low electoral volatility and a low number of political parties (institutional traits) boost the concentration of legislative specialization. Greater electoral stability increases the incentives for parties to specialize further on certain policy jurisdictions. I also argue and verify that lower legislative fragmentation, producing larger parties, reduces the opportunity costs of legislative specialization. As I explain below, understanding the configuration of legislative specialization might help illuminate the evolution of key characteristics of party systems such as its degree of programmaticness and its degree of institutionalization, and to which extent parties are able to construct issue ownership.
    Keywords: legislative specialization, programmatic parties, congress, Latin America
    JEL: H1 H11 H41
    Date: 2013–04–04
  5. By: Konstantin Yanovsky (Gaidar Institute for Economic Policy); Rinat Menyashev (National Research University – Higher School of Economics)
    Abstract: Ratings evaluating the quality of institutions are widely known; they are generally used in academic and research literature. Among such ratings are some whose compilation procedure took decades to perfect. Dozens of assessments have been accumulated, pertaining to a large and growing list of countries. All these ratings use expert evaluations with country ranking. We suppose that such evaluations are essentially incompatible with each other, and therefore inapplicable in a comparative study at some one specific point in time chosen for observation (i.e., for a cross-section analysis). We propose a group of variables of our own, using evaluations of “political” institutions only to ascertain the presence or absence of a certain phenomenon (yes/no). Such a set of variables makes a cross-section analysis feasible. The countries' experience in Rule of Law Democracy and Limited Government (both are quite clearly defined in a formal manner) provides a long-term institutional development aggregate evaluation for cross-section analysis. We also propose a thoroughly simple rating based on combining the proposed variables with indices and indicators which have already become widely accepted, but taking this combination as part of a data panel. At the same time, using a panel regression makes it possible to mitigate the problem of poor compatibility of expert evaluations.
    Keywords: Rule of Law Democracy, Limited Government, Institutions quality indicators, Institutions and Economic growth
    JEL: P50 N40 O43
    Date: 2013

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