nep-pol New Economics Papers
on Positive Political Economics
Issue of 2017‒04‒30
thirteen papers chosen by
Eugene Beaulieu
University of Calgary

  1. Electoral fraud and voter turnout: An experimental study By Vardan Baghdasaryan; Giovanna Iannantuoni; Valeria Maggian
  2. Image Concerns and the Political Economy of Publicly Provided Private Goods By Wagener, Andreas; Lausen, Tobias
  3. Democracy Versus Dictatorship? The Political Determinants of Growth Episodes By Sen, Kunal; Pritchett, Lant; Kar, Sabyasachi; Raihan, Selim
  4. Social protection, electoral competition, and political branding in Malawi By Sam Hamer; Jeremy Seekings
  5. Natural Budget Deficit and Natural Political Cyclicality By Khani Hoolari, Seyed Morteza; Taghinejad Omran, Vahid
  6. A Dynamic Model of Electoral Competition with Costly Policy Changes By Hans Gersbach; Philippe Muller; Oriol Tejada
  7. Voting and Contributing While the Group is Watching By Emeric Henry; Charles Louis-Sidois
  8. Is Western Democracy Backsliding? Diagnosing the Risks By Norris, Pippa
  9. Opinion Dynamics via Search Engines (and other Algorithmic Gatekeepers) By Fabrizio Germano; Francesco Sobbrio
  10. News Coverage of the 2016 General Election: How the Press Failed the Voters By Patterson, Thomas E.
  11. The Economic Impact of Political Instability and Mass Civil Protest By Samer Matta; Simon Appleton; Michael Bleaney
  12. Voter Turnout and Fiscal Policy By Raphael Godefroy; Emeric Henry
  13. News Coverage of the 2016 National Conventions: Negative News, Lacking Context By Patterson, Thomas E.

  1. By: Vardan Baghdasaryan (American University of Armenia and Affiliate Fellow at CERGE-EI, Prague.); Giovanna Iannantuoni (University of Milano-Bicocca); Valeria Maggian (Univ Lyon, CNRS, GATE L-SE UMR 5824, F-69130 Ecully, France)
    Abstract: In this paper we experimentally investigate the consequences of electoral fraud on voter turnout. The experiment is based on a strategic binary voting model where voters decide whether to cast a costly vote in favour of their preferred candidate or to abstain. The minority candidate can illicitly influence the electoral process by applying ballot-box stuffing. In the experiment we implement two different framings: we compare voter turnout in a neutral environment and with framed instructions to explicitly replicate elections. This approach enables to both test the model's predictions and to estimate the framing effects of voting and fraud. Comparison of experimental results with theoretical predictions reveals over-voting, which is exacerbated when fraud occurs. Turnout increases as predicted with moderate level of fraud while, with higher electoral fraud, voters fail to recognize that the existence of a relatively larger number of "agents" voting with certainty considerably decreases the benefits of voting. Importantly, framing matters, as revealed by the higher turnout of those in the majority group, against which the fraud is applied.
    Keywords: Laboratory experiment, Framing, Voting, Electoral fraud, Ballot box stuffng and Voter turnout
    JEL: D72 C52 C91 C92
    Date: 2017
  2. By: Wagener, Andreas (University of Hannover); Lausen, Tobias (University of Hannover)
    Abstract: Governments often provide their citizens with goods and services that are also supplied in markets: education, housing, nutritional assistance, etc. We analyze the political economy of the public provision of private goods when individuals care about their social image. We show that image concerns motivate richer individuals to vote for the public provision of goods they themselves buy in markets, the reason being that a higher provision level attracts more individuals to the public system, enhancing the social exclusivity of market purchases. In effect, majority voting may lead to a public provision that only a minority of citizens use. Users in the public system may enjoy better provision than users in the private system. We characterize the coalitions that can prevail in a political equilibrium.
    Keywords: In-kind provision; status preferences; majority voting;
    JEL: H42 D72
    Date: 2017–03–25
  3. By: Sen, Kunal (University of Manchester); Pritchett, Lant (Harvard University and Center for Global Development, Washington, DC); Kar, Sabyasachi (Institute of Economic Growth, University of Delhi); Raihan, Selim (University of Dhaka)
    Abstract: In contrast to previous literature, which looks at the effect of democracy on long-run growth or short-run volatility of growth, we examine the effect of political institutions on medium-term growth episodes. These are episodes of accelerations and decelerations that characterise the growth experience of most developing countries. We find that the effect of political institutions on growth is asymmetric across accelerations and decelerations, and that democracies do not necessarily outperform autocracies in a growth acceleration episode, though they are likely to prevent large growth collapses. When we disaggregate the type of autocracy, we find that party-based autocracies outperform democracies in growth acceleration episodes, though they do not limit the fall in the magnitude in growth deceleration episodes in comparison to democracies.
    Date: 2016–12
  4. By: Sam Hamer; Jeremy Seekings
    Abstract: Competitive elections in many parts of Africa generate powerful incentives to presidential candidates (and to a lesser extent political parties) to brand themselves in ways that transcend regional or ethnic loyalties. In Malawi, Joyce Banda—President from 2012 to 2014—sought to distinguish herself from her competitors by branding herself and her new People’s Party as the champions of social protection for women, children, and the poor. Some of the conditions that favoured Banda’s adoption of a social protection brand were specific to the political context in Malawi. Elsewhere in East and Southern Africa, presidential candidates and parties have generally denounced ‘handouts’ and avoided the social protection brand. In practice, her rhetorical embrace of social protection and ‘handouts’ was not matched by delivery during her two years in office. Banda’s defeat in the 2014 Malawi election, although caused partly by other factors, suggests that there are limits to the efficacy of social protection branding. Nonetheless, the fact that she has used this brand at all suggests that social protection has grown in political significance, as an expression of pro-poor priorities.
    Date: 2017
  5. By: Khani Hoolari, Seyed Morteza; Taghinejad Omran, Vahid
    Abstract: In this paper we present a framework showing how governments use debt to flaunt competency and increase their votes and the chances of reelection; however, a cognitive bias, namely, the cyclist bias, would disrupt government’s computations. In this model the government’s budget deficit as well as changes in debt would be evaluated in a steady state. We show that debt is a double-edged sword and the more the government relies on debt to show its competency, the more the people understand the manipulations at work behind such measures. On equilibrium, due to cognitive bias in the behavior of individuals, the government will choose budget deficit which it is increasing, leading to the fall of the current incumbent and ultimately the opposition party would take over the power. The model can provide theoretical foundations for what the empirical study of Brender & Drazen (2008) concludes: expansive fiscal policies before elections won't increase reelection probability.
    Keywords: Natural budget deficit, Natural political cyclicality, Cyclist bias
    JEL: D72 E03 E32 E62 H30 H60
    Date: 2017–04–04
  6. By: Hans Gersbach (ETH Zurich, Switzerland); Philippe Muller (ETH Zurich, Switzerland); Oriol Tejada (ETH Zurich, Switzerland)
    Abstract: We consider an infinite-horizon model of elections where policy changes are costly for citizens and parties. The so-called costs of change increase with the extent of the policy shift and make policy history-dependent. First, we provide a detailed description of the equilibrium dynamics and analyze how policies are influenced by history, costs of change, party polarization, and the incumbent's ability. We show that policies converge to a stochastic alternation between two states and that in the long run costs of change have a moderating effect on policies. Second, we analyze welfare as a function of the marginal cost of change. If the initial level of policy polarization is low, welfare is highest for intermediate marginal costs of change. Moreover, any positive level of costs of change will benefit society if the future is sufficiently valuable. If the initial level of policy polarization is high, however, welfare will be highest for low or zero costs of change.
    Keywords: democracy; dynamic elections; political polarization; costs of change; Markov perfect equilibrium
    JEL: C72 C73 D72 D78
    Date: 2017–04
  7. By: Emeric Henry (Département d'économie); Charles Louis-Sidois (Département d'économie)
    Abstract: Members of groups and organizations often have to decide on rules that regulate their contributions to common tasks. They typically differ in their propensity to contribute and often care about the image they project, in particular want to be perceived by other group members as being high contributors. In such environments we study the interaction between the way members vote on rules and their subsequent contribution decisions. We show that multiple norms can emerge. We draw surprising policy implications, on the effect of group size, of supermajority rules and of the observability of actions.
    Date: 2015–10
  8. By: Norris, Pippa (Harvard University)
    Abstract: The predominantly sunny end-of-history optimism about democratic progress, evident in the late-1980s and early-1990s following the fall of the Berlin Wall, has turned rapidly into a more pessimistic zeitgeist. What helps us to understand whether we have reached an inflection point--and whether even long-established European and American democracies are in danger of backsliding? This essay draws on Juan Linz and Alfred Stepan's Problems of Democratic Transition and Consolidation which theorizes that consolidation occurs when three conditions are met: Culturally, the overwhelming majority of people believe that democracy is the best form of government, so that any further reforms reflect these values and principles. Constitutionally, all the major actors and organs of the state reflect democratic norms and practices. Behaviorally, no significant groups actively seek to overthrow the regime or secede from the state. Evidence throws new light on the contemporary state of each of Linz and Stepan's conditions in Western democracies. Culturally the data suggests that, when compared with their parents and grandparents, Millennials in Anglo-American democracies express weaker support for democratic values, but this is not a consistent pattern across Western democracies and post-industrial societies. It is also a life-cycle rather than a generational effect. Constitutionally, trends from estimates by Freedom House and related indicators provide no evidence that the quality of institutions protecting political rights and civil liberties deteriorated across Western democracies from 1972 to end-2016. Most losses occurred under hybrid regimes. Behaviorally, the most serious contemporary threats to Western liberal democracies arise from twin forces that each, in different ways, seek to undermine the regime: sporadic and random terrorist attacks on domestic soil, which damage feelings of security, and the rise of populist-authoritarian forces, which feed parasitically upon these fears.
    Date: 2017–03
  9. By: Fabrizio Germano; Francesco Sobbrio
    Abstract: Ranking algorithms are the information gatekeepers of the Internet era. We develop a stylized framework to study the effects of ranking algorithms on opinion dynamics. We consider rankings that depend on popularity and on personalization. We find that popularity driven rankings can enhance asymptotic learning while personalized ones can both inhibit or enhance it, depending on whether individuals have common or private value preferences. We also find that ranking algorithms can contribute towards the diffusion of misinformation (e.g., “fake news”), since lower ex-ante accuracy of content of minority websites can actually increase their overall traffic share.
    Keywords: search engines, ranking algorithm, search behavior, opinion dynamics, information aggregation, asymptotic learning, misinformation, polarization, website traffic, fake news
    JEL: D83 L86
    Date: 2017–04
  10. By: Patterson, Thomas E. (Harvard University)
    Abstract: Criticism dogged Hillary Clinton at every step of the general election. Her "bad press" outpaced her "good press" by 64 percent to 36 percent. She was criticized for everything from her speaking style to her use of emails. As Clinton was being attacked in the press, Donald Trump was attacking the press, claiming that it was trying to "rig" the election in her favor. If thats true, journalists had a peculiar way of going about it. Trump's coverage during the general election was more negative than Clinton's, running 77 percent negative to 23 percent positive. But over the full course of the election, it was Clinton, not Trump, who was more often the target of negative coverage (see Figure 1). Overall, the coverage of her candidacy was 62 percent negative to 38 percent positive, while his coverage was 56 percent negative to 44 percent positive.
    Date: 2016–12
  11. By: Samer Matta; Simon Appleton; Michael Bleaney
    Abstract: Previous work has investigated whether political instability has a negative effect on economic growth, with mixed results, largely because political instability can take various forms. Using synthetic control methodology, which constructs a counterfactual in the absence of political instability, we estimate the output effect of 38 regime crises in the period 1970-2011. A crucial factor is whether crises are accompanied by mass civil protest. In the crises accompanied by mass civil protest, there is typically an immediate fall in output which is never recovered in the subsequent five years. In crises unaccompanied by protest, there are usually no significant effects.
    Keywords: Political Instability, Economic Recovery, Synthetic Control Method. JEL Classification: C23, F43, P16.
    Date: 2017
  12. By: Raphael Godefroy (Paris-Jourdan Sciences Economiques); Emeric Henry (Département d'économie)
    Abstract: In this paper, we examine whether shocks in voting costs can impact elected representatives' quality, defined as the capacity to fund projects at the lowest cost. Using data on French municipalities and local variations in seasonal infections incidence as a shock on voting cost, we estimate that higher incidence lowers voter turnout, increases subsidies obtained by a municipality, decreases harmful financial decisions, and increases the municipality's investment in infrastructure. We present a model where these predictions would hold, in particular for municipalities with a high base level of turnout.
    Keywords: Turnout; Public finance
    Date: 2016–10
  13. By: Patterson, Thomas E. (Harvard University)
    Abstract: Live television coverage of the national party conventions gives the nominees the opportunity to present themselves unmediated and at length to the American people. There's no moment in the presidential campaign when the candidates so fully control the message as during the party conventions. Yet the live coverage is not the only version of the party conventions. Americans are also exposed to a secondhand rendition, one that is highly mediated. It's the news media's version of the convention, where the prevailing voices are not those of the nominees but instead those of reporters. Figure 1 shows just how true that was of the 2016 convention period. On television and in the newspapers, journalists were the voice behind roughly seven out of every ten news reports about the candidates. The nominees were heard speaking for themselves in less than one in ten reports.
    Date: 2016–09

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