nep-pol New Economics Papers
on Positive Political Economics
Issue of 2017‒02‒05
seven papers chosen by
Eugene Beaulieu
University of Calgary

  1. Electoral Competition and Party Positioning By De Donder, Philippe; Gallego, Maria
  2. One in a Million: Field Experiments on Perceived Closeness of the Election and Voter Turnout By Alan Gerber; Mitchell Hoffman; John Morgan; Collin Raymond
  3. Political Determinants of Competition in the Mobile Telecommunication Industry By Faccio, Mara; Zingales, Luigi
  4. Do political parties matter? Endogenous fragmentation, partisanship, and local public expenditures in Finland By Benoît LE MAUX; Kristýna DOSTÁLOVÁ; Antti MOISIO
  5. Social Media and Fake News in the 2016 Election By Hunt Allcott; Matthew Gentzkow
  6. Jobs, Crime, and Votes: A Short-run Evaluation of the Refugee Crisis in Germany By Gehrsitz, Markus; Ungerer, Martin
  7. A Spatial Analysis of Foreign Aid and Civil Society By Vecci, Joseph; Zelinsky, Tomas

  1. By: De Donder, Philippe; Gallego, Maria
    Abstract: We survey the literature on the positioning of political parties in uni - and multidimensional policy spaces. We keep throughout the survey the assumption that there is an exogenous number of parties who commit to implement their policy proposals once elected. The survey stresses the importance of three modeling assumptions: (i) the source of uncertainty in election results, (ii) the parties'objectives (electoral - maximizing their expected vote share, or their probability of winning the elections'policy oriented or both), and (iii) the voters'preferences(if and how they care for parties beyond the policies implemented by the winner).
    Date: 2017–01
  2. By: Alan Gerber; Mitchell Hoffman; John Morgan; Collin Raymond
    Abstract: A common feature of many models of voter turnout is that increasing the perceived closeness of the election should increase voter turnout. However, cleanly testing this prediction is difficult and little is known about voter beliefs regarding the closeness of a given race. We conduct a field experiment during the 2010 US gubernatorial elections where we elicit voter beliefs about the closeness of the election before and after showing different polls, which, depending on treatment, indicate a close race or a not close race. We find that subjects update their beliefs in response to new information, but systematically overestimate the probability of a very close election. However, the decision to vote is unaffected by beliefs about the closeness of the election. A follow-up field experiment, conducted during the 2014 gubernatorial elections but at much larger scale, also points to little relationship between poll information about closeness and voter turnout.
    JEL: D03 D72 H10 P16
    Date: 2017–01
  3. By: Faccio, Mara; Zingales, Luigi
    Abstract: We study how political factors shape competition in the mobile telecommunication sector. We show that the way a government designs the rules of the game has an impact on concentration, competition, and prices. Pro-competition regulation reduces prices, but does not hurt quality of services or investments. More democratic governments tend to design more competitive rules, while more politically connected operators are able to distort the rules in their favor, restricting competition. Government intervention has large redistributive effects: U.S. consumers would gain $65bn a year if U.S. mobile service prices were in line with German ones and $44bn if they were in line with Danish ones.
    Keywords: Antitrust; capture; political economy
    JEL: D72 L11 P16
    Date: 2017–01
  4. By: Benoît LE MAUX (University of Rennes 1, CREM-CNRS, Condorcet Center for Political Economy, France); Kristýna DOSTÁLOVÁ (University of Rennes 1, CREM-CNRS, France); Antti MOISIO (Finnish Council of Regulatory Impact Analysis)
    Abstract: Both the Weak Government Hypothesis and the Partisan Theory state that institutional settings are sufficiently permissive to allow elected politicians to maximize their own utility at the expense of citizens’ preferences. We test this statement using data on Finnish local public expenditures. One important point is that the composition of the government can be explained by the hetero-geneity of voters’ preferences, hence the need for appropriate techniques to control for a potential selection bias. Using propensity score matching (PSM) methods, we demonstrate that neither the Weak Government Hypothesis nor the Partisan Theory provide an explanation of public spending differences. What appears to be the influence of government composition is in fact shown to be a demand driven process.
    Keywords: Political fragmentation, Partisan effects, Local expenditures, Propensity score matching
    JEL: H72 H40 D72
    Date: 2017–01
  5. By: Hunt Allcott; Matthew Gentzkow
    Abstract: We present new evidence on the role of false stories circulated on social media prior to the 2016 US presidential election. Drawing on audience data, archives of fact-checking websites, and results from a new online survey, we find: (i) social media was an important but not dominant source of news in the run-up to the election, with 14 percent of Americans calling social media their “most important” source of election news; (ii) of the known false news stories that appeared in the three months before the election, those favoring Trump were shared a total of 30 million times on Facebook, while those favoring Clinton were shared eight million times; (iii) the average American saw and remembered 0.92 pro-Trump fake news stories and 0.23 pro-Clinton fake news stories, with just over half of those who recalled seeing fake news stories believing them; (iv) for fake news to have changed the outcome of the election, a single fake article would need to have had the same persuasive effect as 36 television campaign ads.
    JEL: C52 C53 D7 H0 J60
    Date: 2017–01
  6. By: Gehrsitz, Markus (University of Strathclyde); Ungerer, Martin (ZEW Mannheim)
    Abstract: Millions of refugees made their way to Europe between 2014 and 2015, with over one million arriving in Germany alone. Yet, little is known about the impact of this inflow on labor markets, crime, and voting behavior. This article uses administrative data on refugee allocation and provides an evaluation of the short-run consequences of the refugee inflow. Our identification strategy exploits that a scramble for accommodation determined the assignment of refugees to German counties resulting in exogeneous variations in the number of refugees per county within and across states. Our estimates suggest that migrants have not displaced native workers but have themselves struggled to find gainful employment. We find very small increases in crime in particular with respect to drug offenses and fare-dodging. Our analysis further suggests that counties which experience a larger influx see neither more nor less support for the main anti-immigrant party than counties which experience small migrant inflows.
    Keywords: immigration, refugees, unemployment, crime, voting
    JEL: J6 J15 K4 D72
    Date: 2017–01
  7. By: Vecci, Joseph (Department of Economics, School of Business, Economics and Law, Göteborg University); Zelinsky, Tomas (Faculty of Economics, Technical University of Kosice, Kosice, Slovakia)
    Abstract: We use a Spatial Durbin Model to examine the relationship between civil society aid projects and measures of civil society including membership and participation in community groups and satisfaction with democracy in Nigeria and Uganda. We then study the effect of civil society aid programs on corruption, a proxy for elite capture. The spatial model allows us to estimate the effects of project spillovers that may indirectly impact non project areas. We find that civil society aid projects are associated with a decrease in the creation of community groups and attendance at community meetings in Nigeria. In Uganda, we find that civil society aid projects have a negative effect on the membership of community groups in neighboring areas. We also find that civil society projects have a positive effect on satisfaction with democracy, but they reduce satisfaction in neighbouring areas in both Nigeria and Uganda. Our corruption measures reveal that corruption has a positive direct correlation with civil society aid projects in Uganda. A number of robustness measures are used to account for selection.
    Keywords: Foreign Aid; civil society; corruption; Africa; development
    JEL: D72 D73 F35 O10
    Date: 2017–01

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