nep-pol New Economics Papers
on Positive Political Economics
Issue of 2017‒06‒11
thirteen papers chosen by
Eugene Beaulieu
University of Calgary

  1. Learning to Participate in Politics: Evidence from Jewish Expulsions in Nazi Germany By Akbulut-Yuksel, Mevlude; Okoye, Dozie; Yuksel, Mutlu
  2. Who trusts? Ethnicity, integration, and attitudes toward elected officials in urban Nigeria By Adrienne LeBas
  3. Activism, Costly Participation, and Polarization By Venkatesh, Raghul S
  4. Partisan Conflict and Income Distribution in the United States: A Nonparametric Causality-in-Quantiles Approach By Mehmet Balcilar; Seyi Saint Akadiri; Rangan Gupta; Stephen M. Miller
  5. Run For Your Life? The Effect of Close Elections on the Life Expectancy of Politicians By Borgschulte, Mark; Vogler, Jacob
  6. Political economy of trade protection and liberalization: in search of agency-based and holistic framework of policy change. By Trofimov, Ivan D.
  7. Automatic evaluation of faces predict mayor election outcomes in Brazil By Da Silva, Sergio; De Novais, Joao Felipe
  8. Economic Development and Sociopolitical Destabilization: A Re-Analysis By Andrey Korotayev; Ilya Vaskin; Stanislav Bilyuga; Alina Khokhlova; Anastasia Baltach; Eugeny Ivanov; Kira Meshcherina
  9. Democratisation and tax structure: Greece versus Europe from a historical perspective By Pantelis Kammas; Vassilis Sarantides
  10. Protests and Trust in the State: Evidence from African Countries By Marc Sangnier; Yanos Zylberberg
  11. Less Welfare or Fewer Foreigners? Immigrant Inflows and Public Opinion towards Redistribution and Migration Policy By Murard, Elie
  12. Security, Trade, and Political Violence By Francesco Amodio; Leonardo Baccini; Michele di Maio
  13. Effect of Political Decentralization and Female Leadership on Institutional Births and Child Mortality in Rural Bihar, India By Kumar, Santosh; Prakash, Nishith

  1. By: Akbulut-Yuksel, Mevlude (Dalhousie University); Okoye, Dozie (Dalhousie University); Yuksel, Mutlu (Dalhousie University)
    Abstract: This paper provides causal evidence on the importance of socioeconomic circumstances, socialization, and childhood events, in the formation of adult political behaviour and attitudes, using region-by-cohort variation in exposure to the Jewish expulsions in Nazi Germany as a quasi-experiment. We find that the expulsion of Jewish professionals had long-lasting detrimental effects on the political attitudes and beliefs of Germans who were at impressionable years during the Nazi Regime. We further demonstrate that these adverse effects on political behaviour and attitudes may be explained by the social changes brought about by the expulsions, which led to relatively lower adult socioeconomic status and civic skills for individuals in their impressionable ages during the expulsions. These results are robust to several alternative specifications, composition bias induced by differential migration and mortality rates across regions and cohorts, and also regional differences in economic performance, wartime destruction, urbanization, and party support, during the Nazi Regime.
    Keywords: political behaviour, impressionable years, Jewish expulsions, socioeconomic status
    JEL: D72 D74 O12 P16 N40
    Date: 2017–05
  2. By: Adrienne LeBas
    Abstract: In the developing world, clientelism is common. In Africa, public office is often used to redistribute resources to ethnically defined constituencies, and this form of clientelistic exchange is a key determinant of vote choice. Does clientelistic exchange shape trust in elected officials as well? And does it continue to do so as cross-ethnic contact and integration increase? This paper uses public opinion data from urban Nigeria to investigate how an individual’s social position and experiences with the state affect trust in elected officials, especially at the local level. The paper finds that the trust deficit associated with local ethnic minority status does not significantly diminish as these individuals integrate. For members of locally dominant groups, greater crossethnic contact and lessened reliance on ethnicity actually dampen expressed trust in local elected officials. These findings suggest the need for greater attention to cross-ethnic contact when evaluating the political implications of ethnic inequality.
    Date: 2017
  3. By: Venkatesh, Raghul S (Department of Economics, University of Warwick)
    Abstract: I develop a model of activism and polarization in the context of electoral competition. Two candidates simultaneously announce policy platforms and seek the support of ideologically inclined activists. Activists compete to influence electoral outcomes by expending costly support for their respective candidates. The presence of activists always moderates the platform choice of candidates, compared to the case of no activism. The main finding is to provide conditions under which as activists’ ideological partisanship increases (decreases), polarization of candidate platforms reduces (widens) - meaning candidates may compromise even though their supporters become more extreme. I precisely characterize the conditions under which the presence of activism and increasing partisanship among activists are both welfare-improving for voters. Finally, I identify a novel crowding out effect of big money on the demand for activism. My analysis suggests public funding of elections as an important institutional reform that could mitigate the pernicious effects of high polarization.
    Keywords: activism ; electoral participation ; downsian competition ; influence seeking ; public funding
    Date: 2017
  4. By: Mehmet Balcilar (Eastern Mediterranean University, Northern Cyprus, via Mersin 10, Turkey, Montpellier Business School, Montpellier, France and University of Pretoria, Pretoria, South Africa); Seyi Saint Akadiri (Eastern Mediterranean University, Northern Cyprus, via Mersin 10, Turkey); Rangan Gupta (University of Pretoria, Pretoria, South Africa); Stephen M. Miller (University of Nevada, Las Vegas, Las Vegas, Nevada, USA)
    Abstract: This study examines the predictive power of a partisan conflict index on income inequality. Our study adds to the existing literature by using the newly introduced nonparametric causality-in-quantile testing approach to examine how political polarization in the Unites States affects several measures of income inequality and distribution overtime. The study uses annual time-series data from 1917-2013. We find evidence of a causal relationship running from partisan conflict to income inequality, except at the upper end of the quantiles. The study suggests that a reduction in partisan conflict will lead to a more equal income distribution.
    Keywords: Partisan Conflict, Income Distribution, Quantile Causality
    JEL: C22 O15
    Date: 2017–06
  5. By: Borgschulte, Mark (University of Illinois at Urbana-Champaign); Vogler, Jacob (University of Illinois at Urbana-Champaign)
    Abstract: We use a regression discontinuity design to estimate the causal effect of election to political office on natural lifespan. In contrast to previous findings of shortened lifespan among US presidents and other heads of state, we find that US governors and other political office holders live over one year longer than losers of close elections. The positive effects of election appear in the mid-1800s, and grow notably larger when we restrict the sample to later years. We also analyze heterogeneity in exposure to stress, the proposed mechanism in the previous literature. We find no evidence of a role for stress in explaining differences in life expectancy. Those who win by large margins have shorter life expectancy than either close winners or losers, a fact which may explain previous findings.
    Keywords: mortality, stress, regression discontinuity
    JEL: I10 M12 J14
    Date: 2017–05
  6. By: Trofimov, Ivan D.
    Abstract: The paper provides comprehensive review of alternative explanations of the trade policy formation, associated rise of trade protectionism, and difficulties of trade liberalisation. Normative economic, systemic, public interest, political, institutional and constitutional economic theories of trade policy, together with political science models of trade cooperation are considered. The paper shows that current research in the area tends to accentuate the factors that entrench trade protectionism, while paying insufficient attention to the role of agency, policy dynamics and informal institutions that may bring in trade liberalisation. Requirements for holistic and dynamic analysis of trade policy are outlined.
    Keywords: Trade policy, protectionism, liberalisation, policy dynamics.
    JEL: F13 F50 P11 Z18
    Date: 2017–06
  7. By: Da Silva, Sergio; De Novais, Joao Felipe
    Abstract: Elections can be decided on the basis of automatic evaluations of a candidate’s face that take less than one second. These inferences are specific to competence and they could predict better than chance 68.8 percent of the U.S. Senate race results in 2004. Such a finding suggests fast, unreflective trait inferences can contribute to voting choices. We replicated this finding for the 2012 and 2016 municipal elections that took place in the southern Brazil state of Santa Catarina. Mayors could have been elected partially by automatic perceptions of competence.
    Keywords: Voting behavior, Automatic face evaluation, Election outcomes, Nonverbal behavior, Field experiment
    JEL: D03
    Date: 2017
  8. By: Andrey Korotayev (National Research University Higher School of Economics); Ilya Vaskin (National Research University Higher School of Economics); Stanislav Bilyuga (National Research University Higher School of Economics); Alina Khokhlova (National Research University Higher School of Economics); Anastasia Baltach (National Research University Higher School of Economics); Eugeny Ivanov (National Research University Higher School of Economics); Kira Meshcherina (National Research University Higher School of Economics)
    Abstract: Our empirical tests generally confirm the validity of the Olson - Huntington hypothesis suggesting a bell-shaped relationship between the level of economic development and the level of sociopolitical instability. According to this hypothesis, up to certain values of the average per capita income its growth tends to lead to increased risks of sociopolitical destabilization, and only in the upper range of this indicator its growth tends to be associated with the decrease of sociopolitical destabilization risks. Thus, for higher values of per capita income we deal with a negative correlation between per capita income and the risk of sociopolitical instability, and for lower values this correlation is positive. As a result, the maximum values of political instability tend to be observed in the mid-range of the GDP per capita spectrum rather than among the poorest or the richest countries. However, our analysis has shown that for various indices of sociopolitical destabilization this curvilinear relationship can be quite different in some important details. On the other hand, we detect the presence of a very important exception. We show that the relationship between per capita GDP and the intensity of coups and coup attempts is not curvilinear; in this case we are rather dealing with a pronounced negative correlation; a particularly strong negative correlation is observed between this index and the logarithm of GDP per capita. We demonstrate that this fact makes the abovementioned bell-shaped relationship with respect to the integral index of sociopolitical destabilization considerably less distinct and makes a very significant contribution to the formation of its asymmetry (when the negative correlation between per capita GDP and sociopolitical destabilization among the richer countries looks much stronger than the positive correlation among poorer countries). However, our analysis shows that for all the other indices of sociopolitical destabilization we do witness the bell-shaped relationship assumed by the Olson - Huntington hypothesis. On the other hand, for example, in relation to such indices, as political strikes, riots and anti-government demonstrations we deal with such an asymmetry that is directly opposite to that mentioned above - with such an asymmetry, when a positive correlation between GDP and instability for poorer countries is much stronger than the negative correlation for richer countries. An especially strong asymmetry of this kind is found for such an important index of social and political destabilization, as the intensity of anti-government demonstrations. Thus, we arrive at the following conclusions. (1) Different types of political instability events have different functional relationships to changing levels of GDP/capita. Some do have a curvilinear response, others have a monotonic one. They also are more frequent at certain ranges of GDP/capita that are not the same, but rather are particular to certain types of events. (2) These findings show that certain types of events are more common at lower levels of income and political development, while others are more common at mid-levels, and yet others (anti-government protests, strikes) are more common at higher levels. (3) The functional relationships are most often linear in rising stages, but exponential or logarithmic in their declines. There are thus generally strong asymmetries in how such events react to changes in GDP/cap in the lower vs. upper ranges. (4) The overall notion of a curvilinear relationship between instability and GDP/capita is thus too simple, obscuring important patterns that reveal a trajectory of varying kinds of instability developing and peaking at different levels of economic development.
    Keywords: Political instability, CNTS destabilization indices, economic development, GDP per capita, coups, anti-government demonstrations, sociopolitical destabilization, political development
    JEL: Z
    Date: 2017
  9. By: Pantelis Kammas; Vassilis Sarantides
    Abstract: Building on a unique dataset that contains 13 different tax categories of the Greek state over the period 1833-1933, this paper studies the effect of democratisation on the size and the composition of tax revenues. Empirical analysis suggests that the radical reform that enfranchised all adult males in Greece in 1864 did not affect the level of taxation, but did exert a significant impact on its structure. Universal male suffrage was accompanied by an amazing reduction in rural taxes (e.g., taxes on land) and remarkable increases in indirect taxes – mostly in custom and excises duties. These findings clearly indicate that there were political economy motives behind this shift in the implemented fiscal policy. In particular, the Greek governments changed the structure of taxation in order to satisfy the large majority of the electorate, who were peasants and farmers, ensuring a minimum level of social cohesion. Using also a sample of 12 Western European countries over the same period, we show that the phase of economic development induced a differentiated effect of democratisation on the size and the structure of taxation.
    Keywords: democracy, tax structure, fiscal capacity
    Date: 2017–05
  10. By: Marc Sangnier; Yanos Zylberberg
    Abstract: This paper provides empirical evidence that, after protests, citizens substantially revise their views on the current leader, but also their trust in the country's institutions. The empirical strategy exploits variation in the timing of an individual level survey and the proximity to social protests in 13 African countries. First, we find that trust in political leaders strongly and abruptly decreases after protests. Second, trust in the country monitoring institutions plunges as well. Both effects are much stronger when protests are repressed by the government. As no signs of distrust are recorded even a couple of days before the social conflicts, protests can be interpreted as sudden signals sent on a leaders' actions from which citizens extract information on their country fundamentals.
    Keywords: Protests, trust, institutions, leaders.
    JEL: D74 D83 H41 O17
    Date: 2017–05–29
  11. By: Murard, Elie (IZA)
    Abstract: I examine the effect of immigrant inflows in Europe on natives' individual attitudes towards redistribu-tion and immigration policy over the last decade. Unlike previous studies, I analyze the evolution over time of these two types of attitudes in a joint empirical framework. Using migration data at the NUTS regional level from the European Labor Force Survey and individual attitudes data from the European Social Survey, I exploit variation over time and across regions in the size and composition of immigrant inflows. I address the endogeneity of immigrant inflows by using a shift share instrument and within-country specification. I find evidence coherent with a theoretical model in which individual attitudes depend essentially on how immigration is perceived to affect wages and net welfare benefits. Specifi-cally, I find that, when immigrants tend to compete with natives for jobs (due to having similar skills or occupations), natives prefer policies that support welfare and put restrictions on migration. When mi-grants are mostly low-skilled (high-skilled), European citizens typically favor lower (higher) levels of redistribution.
    Keywords: immigration, welfare state, political economy
    JEL: F22 F1 J61
    Date: 2017–05
  12. By: Francesco Amodio (McGill University); Leonardo Baccini (McGill University); Michele di Maio (University of Naples)
    Abstract: To address security concerns, governments often implement trade barriers and re- strictions on the movement of goods and people. These restrictions have negative economic consequences, possibly increasing the supply of political violence. To test this hypothesis, we exploit the restrictions imposed by Israel on imports to the West Bank as a quasi-experiment. In 2008 Israel started enforcing severe restric- tions on the import of selected dual-use goods and materials, de facto banning a number of production inputs from entering the West Bank. We show that after 2008 (i) output and wages decrease in those manufacturing sectors that use those materials more intensively as production inputs, (ii) wages decrease in those local- ities where employment is more concentrated in these sectors, and (iii) episodes of political violence are more likely to occur in these localities. Our calculations suggest these effects account for 18% of the violent political events that occurred in the West Bank from 2008 to 2014.
    Keywords: security, trade, political violence. JEL Classification: D22, D24, F51, N45, O12.
  13. By: Kumar, Santosh (Sam Houston State University); Prakash, Nishith (University of Connecticut)
    Abstract: In this paper, we investigate the impacts of political decentralization and women reservation in local governance on institutional births and child mortality in the state of Bihar, India. Using the difference-in-differences methodology, we find a significant positive association between political decentralization and institutional births. We also find that the increased participation of women at local governance led to an increased survival rate of children belonging to richer households. We argue that our results are consistent with female leaders having policy preference for women and child well-being.
    Keywords: gender quota, political decentralization, institutional delivery, child, mortality, Bihar, India
    JEL: H41 I15 J16 O12
    Date: 2017–05

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