nep-pol New Economics Papers
on Positive Political Economics
Issue of 2015‒01‒19
twenty-one papers chosen by
Eugene Beaulieu
University of Calgary

  1. Managed Competition And Voting Stability: Evidence From Russian Legislative Elections (2003-2011) By Elena V. Sirotkina
  2. Income and policy choices: Evidence from parliamentary decisions and referenda By David Stadelmann; Marco Portmann; Reiner Eichenberger
  3. Proportional Representation with Uncertainty By Francesco De Sinopoli; Giovanna Iannantuoni; Elena Manzoni; Carlos Pimienta
  4. The Multiple Hierarchical Legislatures in a Representative Democracy: Districting for Policy Implementation By Kobayashi, Katsuya; Tasnádi, Attila
  5. Why not solve the democratic deficit within the EU through genuine transnational political conflict? By Jan Karremans
  6. Appointed Versus Elected Mayors and Incentives to Pork-Barrel: Quasi-Experimental Evidence from Germany By Zohal Hessami
  7. The Welfare State and Migration: A Dynamic Analysis of Political Coalitions By Assaf Razin; Efraim Sadka; Benjarong Suwankiri
  8. Political Change and the Business Elite in Indonesia By Johansson, Anders
  9. Majority Voting: A Quantitative Investigation By Carroll, Daniel R.; Dolmas, James; Young, Eric R.
  10. The Institutionalization Of The Party System In Russia: Opportunities And Threats At The Elections Of Governors By Yuriy O. Guyvoronskiy; Svetlana A. Karandashova; Elena V. Sirotkina; Anastasia Y. Shishorina
  11. Candidate Ballot Information and Election Outcomes: The Czech Case By Jurajda, Štepán; Münich, Daniel
  12. Exclusive Solidarity? Radical Right Parties and the Welfare State By Elie Michel
  13. Puzzles of public opinion: Why Soviet population supports the transition to capitalism since the 1980S By Popov, Vladimir
  14. Can political inequalities be educated away? Evidence from a Swedish school reform By Lindgren, Karl-Oskar; Oskarsson, Sven; T Dawes, Christopher
  15. Efficiency, Policy Selection, And Growth In Democracy And Autocracy: A Formal Dynamical Model By Andrei S. Akhremenko; Alexander Petrov
  16. THE CONSEQUENCES OF POLITICAL PARTY INDEQUATE MANAGEMENT By Ljubisa Stojimirović, Aleksandra Stojković, Tomislav Nikolić
  17. Bias in Cable News: Real Effects and Polarization By Gregory J. Martin; Ali Yurukoglu
  18. Fire in Cairo: Authoritarian-redistributive social contracts, structural change and the Arab spring By Eric ROUGIER
  19. Why do Budgets Received by State Prosecutors Vary Across Districts in the United States? By Manu Raghav
  20. The Political Economy of the Disability Insurance: Theory and Evidence of Gubernatorial Learning By Radha Iyengar Giovanni Mastrobuoni
  21. The Consequences of Social Pressures on Partisan Opinion Dynamics By Shyam Gouri Suresh; Scott Jeffrey

  1. By: Elena V. Sirotkina (National Research University Higher School of Economics)
    Abstract: Does limited competition promote voting stability and party system institutionalization? Since Russian political parties face administrative impediments to participating in elections, only those who adapt to the changing rules remain in the game. Thus, voters have a limited number of parties to support and with no alternatives they might tend to stick to their choice. In this paper, I take stability in electoral support as an indicator of party system institutionalization and test whether limited competition in non-democratic Russia leads to voting stability and party system institutionalization. Empirical evidence is taken from the Russian State Duma elections in 2003-2011.
    Keywords: institutionalization, Russian parties, elections, voting geography.
    JEL: D72
    Date: 2014
  2. By: David Stadelmann; Marco Portmann; Reiner Eichenberger
    Abstract: We analyze political representation of preferences of different income groups by matching referendum outcomes for low, middle, and high-income voters with individual legislators' decisions on identical policy proposals. Results indicate that legislators more closely represent preferences of rich voters than preferences of middle-income and poor voters, and legislators are more responsive towards the rich. Preferences of low, middle, and high-income voters are, however, correlated. Representation of income groups varies according to legislators' party affiliations.
    Keywords: Income; policy decisions; representation; voting; referenda; political behavior
    JEL: D72 H70
    Date: 2014–12
  3. By: Francesco De Sinopoli; Giovanna Iannantuoni; Elena Manzoni; Carlos Pimienta
    Abstract: We introduce a model with strategic voting in a parliamentary election with proportional representation and uncertainty about voters’ preferences. In any equilibrium of the model, most voters only vote for those parties whose positions are extreme. In the resulting parliament, a consensus government forms and the policy maximizing the sum of utilities of the members of the government is implemented.
    Keywords: Proportional Election, Strategic Voting, Legislative Bargaining
    JEL: C72 D72
    Date: 2014–12
  4. By: Kobayashi, Katsuya; Tasnádi, Attila
    Abstract: We build a multiple hierarchical model of a representative democracy in which, for instance, voters elect county representatives, county representatives elect district representatives, district representatives elect state representatives, and state representatives elect a prime minister. We use our model to show that the policy determined by the final representative can become more extreme as the number of hierarchical levels increases because of increased opportunities for gerrymandering. Thus, a sufficiently large number of voters gives a district maker an advantage, enabling her to implement her favorite policy. We also show that the range of implementable policies increases with the depth of the hierarchical system. Consequently, districting by a candidate in a hierarchical legislative system can be viewed as a type of policy implementation device.
    Keywords: electoral systems, median voter, gerrymandering, council democracies.
    JEL: D72
    Date: 2014–12–17
  5. By: Jan Karremans
    Abstract: The last European elections of 2014 were characterized by a concrete effort to increase public participation to the European political debate. However the overall electoral turnout remained disappointingly low. In this paper I deal with the problem of the formation of a European electorate and argue that a better representation on the European integration dimension should substantially contribute to the formation of a transnational electorate. Often, there is the fear that European political conflict framed on this dimension would lead to a radical bipolar conflict between pro- and anti-EU parties. In this paper I show that, if citizens’ preferences are properly represented, this does not have to be the case. What I show is that citizens’ preferences on European integration are distributed in three roughly equivalent blocs: pro-EU, anti-EU and a neutral position. The point I make is that a proper representation of the neutral position should ensure that the conflict does not become too radical, as the parties representing the neutral position would be the necessary coalition partners of both pro- and anti-EU parties. An important shortcoming of the current European parliament, I argue, is that the neutral position on European integration is not represented and that consequently there is a disproportionate high presence of pro-EU parties. This misrepresentation in the long run may increase the public appeal of Euro-sceptic parties. The data on which my argument is based are from the 2014 Eurobarometer survey.
    Keywords: European Parliament
    Date: 2014–10–29
  6. By: Zohal Hessami (Department of Economics, University of Konstanz, Germany)
    Abstract: Do incentives and policy choices of public officials depend on whether they are appointed by an elected body or directly elected by voters? I investigate this question using the example of state grants for highly visible municipal investment projects. To attract these grants, mayors must prepare and submit applications to the state government. My identification strategy exploits a natural experiment in a German state where mayor elections were gradually introduced. The difference-in-differences estimation results show that elected mayors attract 7 to 8% more investment grants from the state tier in election years, while for appointed mayors there is no cycle. Results based on hand-collected data for individual mayors exclude alternative transmission channels such as changes in (self-)selection of mayors or partisan alignment in grant allocation.
    Keywords: Mayor elections; local government; electoral incentives; pork-barrel politics; intergovernmental grants
    JEL: D72 H72 H77
    Date: 2014–12–01
  7. By: Assaf Razin; Efraim Sadka; Benjarong Suwankiri
    Abstract: We develop a dynamic political-economic theory of welfare state and immigration policies, featuring three distinct voting groups: skilled workers, unskilled workers, and old retirees. The essence of inter- and intra-generational redistribution of a typical welfare system is captured with a proportional tax on labor income to finance a transfer in a balanced-budget manner. We characterize political-economic equilibrium policy rules consisting of the tax rate, the skill composition of migrants, and the total number of migrants. When none of these groups enjoy a majority (50 percent of the voters or more), political coalitions will form. With overlapping generations and policy-determined influx of immigrants, the formation of the political coalitions changes over time. These future changes are taken into account when policies are shaped. The paper characterizes the evolution of the political coalitions that implement welfare state and migration policies.
    JEL: F22 H0
    Date: 2014–12
  8. By: Johansson, Anders (Stockholm China Economic Research Institute)
    Abstract: As Suharto’s authoritarian regime came to an end in 1998, the country’s business elite faced new challenges. While rent seeking had previously primarily taken place through direct relationships with and concessions from Suharto, the business elite in contemporary Indonesia operates in a setting with a higher degree of fluidity and uncertainty. This study sheds light on how the changes to the political landscape in Indonesia have affected the business elite. This is done by tracing the relationship between business and politics throughout history from the colonial period up to contemporary Indonesia. It also discusses how these changes have made the analysis of political connections and the value of political capital more complicated and highlights some of the factors believed to be important when analyzing the economics behind business-political relationships in Indonesia.
    Keywords: Indonesia; political change; rent seeking; political connections; patronage; patrimonialism; elite; oligarchy
    JEL: D72 G30 G38
    Date: 2014–12–17
  9. By: Carroll, Daniel R. (Federal Reserve Bank of Cleveland); Dolmas, James (Federal Reserve Bank of Dallas); Young, Eric R. (University of Virginia)
    Abstract: We study the tax systems that arise in a once-and-for-all majority voting equilibrium embedded within a macroeconomic model of inequality. We find that majority voting delivers (i) a small set of outcomes, (ii) zero labor income taxation, and (iii) nearly zero transfers. We find that majority voting, contrary to the literature developed in models without idiosyncratic risk, is quite powerful at restricting outcomes; however, it also delivers predictions inconsistent with observed tax systems.
    Keywords: Political Economy; Essential Set; Voting; Inequality; Incomplete Markets
    JEL: D52 D72 E62
    Date: 2015–01–07
  10. By: Yuriy O. Guyvoronskiy (National Research University Higher School of Economics); Svetlana A. Karandashova (National Research University Higher School of Economics); Elena V. Sirotkina (National Research University Higher School of Economics); Anastasia Y. Shishorina (National Research University Higher School of Economics)
    Abstract: Does the level of party system institutionalization influence high-level incumbents’ electoral support within subnational authoritarianism? Is it possible to ensure incumbent electoral success only with manipulative electoral practices? To what extent does this and other factors contribute to the incumbents’ landslide victory? Contrary to scholarly thought in this field, this paper argues that manipulative practices are not the only determinant of incumbents’ electoral success in an authoritarian regime. They are also insufficient. The research is based on the results Russian gubernatorial elections in 2012-2013
    Keywords: party system institutionalization, incumbent, electoral authoritarianism, governor elections, regional regimes
    JEL: D72
    Date: 2014
  11. By: Jurajda, Štepán (CERGE-EI); Münich, Daniel (CERGE-EI)
    Abstract: We measure the importance of candidate characteristics listed on ballots for a candidate's position on a slate, for preferential votes received by a candidate, and, ultimately, for getting elected. We focus on the effects of gender, various types of academic titles, and also several novel properties of candidates' names. Using data on over 200 thousand candidates competing in recent Czech municipal board and regional legislature elections, and conditioning on slate fixed effects, we find ballot cues to play a stronger role in small municipalities than in large cities and regions, despite the general agreement on higher candidate salience in small municipalities. We also quantify the election advantage of a slate being randomly listed first on a ballot.
    Keywords: low-information elections, ballot order effects, name properties
    JEL: D72 D83
    Date: 2014–12
  12. By: Elie Michel
    Abstract: Radical right parties in Western Europe have traditionally shown little support for redistributive policies and have thus been typically classified as economically right wing. Yet, they are contesting the votes of a (formerly) key electorate of the social democratic parties: the working class, who supports welfare redistribution. In this study, we argue and empirically demonstrate that radical right parties have adapted their programmatic preferences to this key segment of electorate by progressively promoting redistributive policies. For our analyses we use mixed methods and rely on a combination of data sources. Firstly, we assess the salience of welfare issues in the manifestos of major West European radical right parties over the last three decades based on CMP data. Secondly, we examine their positions on welfare issues based on recent euandi data. Thirdly, we analyse the most recent manifestos of two successful radical right parties (Austrian FPÖ and French FN) qualitatively. Our findings show that for a majority of radical right parties welfare state expansion has become a salient issue, and that they do not position themselves anymore on the right regarding redistributive issues; however, these parties promote a specific kind of solidarity: exclusive solidarity.
    Keywords: political parties
    Date: 2014–12–16
  13. By: Popov, Vladimir
    Abstract: Why even after the dramatic increase in inequality in the 1990s and after the emergence and enrichment of “oligarchs”, the alternative (leftist, social democratic) economic policies that could have improved material and social wellbeing of the majority of the population is not supported by this majority? It is argued that in immature democracies (without efficient restrictions for the participation of private capital in politics) mass media and electoral campaigns are controlled by the rich, so there is vicious circle: market reforms and private property create the class of the wealthy “oligarchs” that are not only interested in these reforms, but also have power to maintain their political and economic might through mass media and democratic elections. The return of public opinion to the “norm” so that it reflects interests of the majority is possible only if mass media and political process are separated from private capital and private financing.
    Keywords: Public opinion, transition from socialism to capitalism, inequalities, elections, mass media
    JEL: H00 P26 P3
    Date: 2014–12–24
  14. By: Lindgren, Karl-Oskar (IFAU - Institute for Evaluation of Labour Market and Education Policy); Oskarsson, Sven (Department of Government, Uppsala University); T Dawes, Christopher (Department of Politics, New York University)
    Abstract: Over the years, many suggestions have been made on how to reduce the importance of family background in political recruitment. In this study, we examine the effectiveness of one such proposal: the expansion of mass education. More precisely, we utilize a difference-in-difference strategy to analyze how a large school reform launched in Sweden in the 1950s, which lengthened compulsory schooling and postponed tracking, affected the likelihood of individuals with different family backgrounds to run for public office. The data comes from public registers and pertains to the entire Swedish population born between 1943 and 1955. Overall, the empirical analysis provides strong support for the view that improved educational opportunities for individuals from disadvantaged backgrounds can be an effective means to reduce the importance of family background in political recruitment. According to our estimates, the Swedish comprehensive school reform served to reduce the effect of family background on the likelihood of running for public office by up to 40 percent.
    Keywords: Political inequality; political participation; political candidacy; inequality; education
    JEL: H70 I24
    Date: 2014–12–19
  15. By: Andrei S. Akhremenko (National Research University Higher School of Economics); Alexander Petrov (National Research University Higher School of Economics)
    Abstract: The main focus of this paper is the impact of efficiency losses, related to public capital stock, on the prospects of economic growth in democratic and autocratic political environments. We introduce a distinction between two types of efficiency loss: along with the loss of public capital during its accumulation, we take into account the process of capital stock depreciation. We demonstrate that the decrease in efficiency of any type makes the probability of long-run growth higher for autocracies; however, in the presence of high efficiency, democracies tend to perform better. The results were obtained by formal analysis and computational experiments, realized on the basis of an original dynamical model.
    Keywords: dynamical formal model, policy space, democracy, autocracy, economic growth, efficiency, public capital
    JEL: C02 P16 Z18
    Date: 2014
  16. By: Ljubisa Stojimirović, Aleksandra Stojković, Tomislav Nikolić (Belgrade Business Schol, Belgrade)
    Abstract: Political parties belong to organizational systems and they must be guided. Defining the aims, the way they are put in practice, constant control, management team choice, cooperation with the environment are just some of the activities political party management is involved in. Management efficiency depends on how long and in what way political party is going to last. Successful management can lead political party to unexpected heights (achievements).
    Keywords: management, political party, objectives, controls, team
    JEL: I I
    Date: 2014–09
  17. By: Gregory J. Martin; Ali Yurukoglu
    Abstract: We jointly measure the persuasive effects of slanted news and tastes for like-minded news. The key ingredient is using channel positions as exogenous shifters of cable news viewership. Local cable positions affect viewership by cable subscribers. They do not correlate with viewership by local satellite subscribers, who are observably similar to cable subscribers. We estimate a model of voters who select into watching slanted news, and whose ideologies evolve as a result. We estimate that Fox News increases the likelihood of voting Republican by 0.9 points among viewers induced into watching four additional minutes per week by differential channel positions.
    JEL: D72 D83 L82
    Date: 2014–12
  18. By: Eric ROUGIER
    Abstract: In this paper, we argue that the Arab spring can be understood as a violent criticism of and attack against the post-Independence social contract that prevailed in most Middle East and North African countries. We show that this social contract, characterized by the combination of high levels of redistribution and low political accountability and social inclusiveness may well explain (1) the slow pace of structural change relative to the rest of the world and (2) the specific political economy that have triggered social discontent among the young, and broad cohorts of educated workers, and eventually thrown populations onto the streets. More specifically, it is shown that authoritarianism reduces the positive effect of redistribution on structural change, with this adverse effect being even larger when the likely endogeneity of the social contract to the export structure is controlled for. We also describe the specific political economy that was conducive to the low democracy-low diversification equilibrium featured by most Arab economies.
    Keywords: Social contract, redistribution, authoritarianism, structural change, export diversification, export sophistication, political economy, Middle East and North Africa, inequality of opportunities
    JEL: I38 O14 O43 P16 P48
    Date: 2014
  19. By: Manu Raghav (Department of Economics and Management, DePauw University)
    Abstract: This paper analyzes how the budget allocated to state prosecutors' offices vary across prosecutorial districts and the reasons for such variation by empirical methods, using data from Census of Prosecutors and other sources. The main results of this paper are as follows. Other factors being equal, the state prosecutor's budget increases with the crime rate in the prosecutorial district and the per-capita income of the district. State prosecutors in more politically conservative prosecutorial districts, as measured by the percentage of votes that President Bush won in 2000 presidential election, get smaller budgets and this decrease in the prosecutorial budget of a district with political conservatism is larger in more affluent and in more populous districts.
    Keywords: Prosecuting Attorneys, District Attorneys, State Courts, Crime, Prosecution, Litigation Process, Budget.
    JEL: K40 K41 K42 H72 H76
    Date: 2014–11
  20. By: Radha Iyengar Giovanni Mastrobuoni
    Keywords: Disability insurance, Principal-agent, Social security administration, Monitoring
    JEL: I J
    Date: 2014–07–21
  21. By: Shyam Gouri Suresh; Scott Jeffrey
    Abstract: We simulate a theoretical model of opinion dynamics that captures the effects of social pressures that compel individuals to publicly conform to the party line even when they disagree with it privately. We observe various interesting patterns of opinion formation and other consequences, including polarization within and between parties and marginalization of extremists. We find that our simple framework can explain certain features of recent data such as the influence of parties on individual opinions and the increasing polarization of the polity.
    Keywords: Opinion Dynamics, Polarization, Agent-Based, Overton Window
    JEL: D7 C63
    Date: 2014–12

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