nep-pol New Economics Papers
on Positive Political Economics
Issue of 2018‒01‒08
23 papers chosen by
Eugene Beaulieu
University of Calgary

  1. Financial literacy and political orientation in Great Britain By Alberton Montagnoli; Mirko Moro; Georgios A Panos; Robert E Wright
  2. Compulsory Voting, Voter Turnout and Asymmetrical Habit-formation By Stefanie Gäbler; Niklas Potrafke; Felix Rösel
  3. The political economy of policy exceptionalism during economic transition: the case of rice policy in Vietnam By Nguyen, H.T.M.; Do, H.; Kay, A.; Kompas, T.; Nguyen, C.N.; Tran, C.T.
  4. Incumbency Disadvantage in U.S. National Politics: The Role of Policy Inertia and Prospective Voting By Chatterjee, Satyajit; Eyigungor, Burcu
  5. Politics, Hospital Behaviour and Health Care Spending By Zack Cooper; Amanda Kowalski; Eleanor Neff Powell; Jennifer Wu
  6. The Blogosphere and Political News in Nigeria By Boniface Nkem Anusiem
  7. Sitting on the fence: Pork - barrels and democratization under threat of conflict. The case of Ghana, 1996 - 2004 By Pierre André; Sandrine Mesplé-Somps
  8. Assessment Voting in Large Electorates By Hans Gersbach; Akaki Mamageishvili; Oriol Tejada
  9. Similar or Different? Exploring the Gap between Federal and Regional Elections in Russia By Rostislav Turovsky; Marina Sukhova
  10. The Determinants of Islamophobia - An Empirical Analysis of the Swiss Minaret Referendum By Olga Orlanski; Günther G. Schulze
  11. Exploring the Effects on the Electoral College of National and Regional Popular Vote Interstate Compact: An Electoral Engineering Perspective By Laurent, Thibault; Le Breton, Michel; Lepelley, Dominique; de Mouzon, Olivier
  12. The Political Economy of Opposition Groups: Peace, Terrorism, or Civil Conflict By Michael Jetter; Bei Li
  13. Why Do Military Dictatorships Become Presidential Democracies? Mapping the Democratic Interests of Autocratic Regimes By Bjørnskov, Christian
  14. Do Gender Preference Gaps Impact Policy Outcomes? By Eva Ranehill; Roberto A. Weber
  15. Historical Roots of Political Extremism: The Effects of Nazi Occupation of Italy By Nicola Fontana; Tommaso Nannicini; Guido Tabellini
  16. Uncovering Powerful East Asian Women Politicians in News Media By Tsz Lam Ngai
  17. Optimal Voting Rules under Participation Constraints By Antonin Macé; Rafael Treibich
  18. Assessing the 2016 U.S. Presidential Election Popular Vote Forecasts By Graefe, Andreas; Armstrong, J. Scott; Jones, Randall J.; Cuzan, Alfred G.
  19. Identifying barriers towards a post-growth economy: A political economy view By Strunz, Sebastian; Schindler, Harry
  20. Austerity and the rise of the Nazi party By Gregori Galofré-Vilà; Christopher M. Meissner; Martin McKee; David Stuckler
  21. Mandatory Spending, Political Polarization, and Macroeconomic Volatility By Grechyna, Daryna
  22. Agenda Divergence in a Developing Conflict: A Quantitative Evidence from a Ukrainian and a Russian TV Newsfeeds By Olessia Y. Koltsova; Sergei V. Pashakhin
  23. Ecologies of ideologies : Explaining party entry and exit in European parliaments, 1945-2013 By van de Wardt, Marc; Berkhout, Joost; Vermeulen, Floris

  1. By: Alberton Montagnoli; Mirko Moro; Georgios A Panos; Robert E Wright (Department of Economics, University of Strathclyde)
    Abstract: This study examines the relationship between financial literacy and political orientation in Great Britain. Using novel data from the British Election Survey in 2014, we employ two distinct measures of political orientation, capturing individual self-assessment on a left-right axis and party preferences. We find that financially-literate individuals are some 11-19 percent more likely to orientate at the centre-left or the centre-right. Moreover, they are some 30 percent less likely not to know their political orientation. The results are robust when rich sets of public-attitude and public-value variables are accounted for. Financially-literate individuals are also more likely to have a stable political orientation over time and they are some 15-23 percent less likely to change attitudes radically towards the left or the right across different waves of the study. We interpret our findings as indicative that greater financial literacy is conducive to greater stability of moderate political views and orientation.
    Keywords: Financial literacy, political orientation, attitudes, polarization, Great Britain
    JEL: D14 D63 D72 I24
    Date: 2016–09
    URL: http://d.repec.org/n?u=RePEc:str:wpaper:1614&r=pol
  2. By: Stefanie Gäbler; Niklas Potrafke; Felix Rösel
    Abstract: We examine whether compulsory voting influences habit-formation in voting. In Austria, some states temporarily introduced compulsory voting in national elections. We exploit border municipalities across two states that differ in compulsory voting legislation using a difference-in-differences and a difference-in-discontinuity approach. We investigate the long-term effects of compulsory voting on voter turnout, invalid votes and vote shares for left-wing and right-wing parties. The results show that compulsory voting increased voter turnout by 3.4 percentage points. When compulsory voting was abolished, voter turnout, however, returned to the pre-compulsory voting level. The results also do not suggest that compulsory voting influenced invalid votes and vote shares of left-wing and right-wing parties asymmetrically. We conclude that compulsory voting was not habit-forming.
    Keywords: compulsory voting, voter turnout, party vote shares, difference-in-discontinuity design, habit-formation, Austria
    JEL: D72 P10
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:ces:ceswps:_6764&r=pol
  3. By: Nguyen, H.T.M.; Do, H.; Kay, A.; Kompas, T.; Nguyen, C.N.; Tran, C.T.
    Abstract: The global food security agenda depends on the world rice market which is the thinnest among key cereal markets and often distorted by government interventions. Existing literature suggests that these interventions are not economically efficient. This paper focuses on the political economy of those interventions, asking why they were adopted. The answer is drawn from insights on Vietnam as a case study. Although by no means a representative case, Vietnam is chosen not only for being a key rice exporter but especially so for its unique success in overcoming the inherent tension between `socialist' and `market-based' objectives during its transition to a market-based economy, albeit with a socialist orientation. We find that rice sector in Vietnam has not been fully reformed to follow market rules despite Vietnam's accession to the World Trade Organization. This is due to the interaction of economic liberalisation processes and the ruling Communist Party's political survival strategy. In this context, seemingly economic disequilibria are shown to be stable, enduring policy settings. In open economy politics, the case reveals how economically sub-optimal policies may be `successful' politically even in the face of what appear to be severe domestic political constraints on reform from external economic pressures.
    Keywords: Food policy, rice, political economy, Vietnam, Communist Party
    Date: 2017–12
    URL: http://d.repec.org/n?u=RePEc:een:crwfrp:1713&r=pol
  4. By: Chatterjee, Satyajit (Federal Reserve Bank of Philadelphia); Eyigungor, Burcu (Federal Reserve Bank of Philadelphia)
    Abstract: We document that postwar U.S. national elections show a strong pattern of incumbency disadvantage": If the presidency has been held by a party for some time, that party tends to lose seats in Congress. We develop a model of partisan politics with policy inertia and prospective voting to explain this finding. Positive and normative implications of the model are explored.
    Keywords: rational partisan model; incumbency disadvantage; policy inertia; prospective voting; median voter
    JEL: D72 H50
    Date: 2017–12–21
    URL: http://d.repec.org/n?u=RePEc:fip:fedpwp:17-43&r=pol
  5. By: Zack Cooper; Amanda Kowalski; Eleanor Neff Powell; Jennifer Wu
    Abstract: This paper examines the link between legislative politics, hospital behaviour, and health care spending. When trying to pass sweeping legislation, congressional leaders can attract votes by adding targeted provisions that steer money toward the districts of reluctant legislators. This targeted spending provides tangible local benefits that legislators can highlight when fundraising or running for re-election. We study a provision - Section 508 - that was added to the 2003 Medicare Modernization Act (MMA). Section 508 created a pathway for hospitals to apply to get their Medicare payment rates increased. We find that hospitals represented by members of the House of Representatives who voted 'Yea' on the MMA were significantly more likely to receive a 508 waiver than hospitals represented by members who voted 'Nay.' Following the payment increase generated by the 508 program, recipient hospitals treated more patients, increased payroll, hired nurses, added new technology, raised CEO pay, and ultimately increased their spending by over $100 million annually. Section 508 recipient hospitals formed the Section 508 Hospital Coalition, which spent millions of dollars lobbying Congress to extend the program. After the vote on the MMA and before the vote to reauthorize the 508 program, members of Congress with a 508 hospital in their district received a 22% increase in total campaign contributions and a 65% increase in contributions from individuals working in the health care industry in the members' home states. Our work demonstrates a pathway through which the link between politics and Medicare policy can dramatically affect US health spending.
    Keywords: health care, US, hospital, politics
    JEL: I10 I18 H51 D72 P16
    Date: 2017–12
    URL: http://d.repec.org/n?u=RePEc:cep:cepdps:dp1523&r=pol
  6. By: Boniface Nkem Anusiem (Seton Hall University, New Jersey, USA)
    Abstract: The 2015 Elections in Nigeria is one of the most significant events in Nigerian history; at least in the recent past. Nigerians were highly disposed to the electioneering process by their active participation especially through the platforms provided by the social media. Hence, various social media outlets formulated dependable avenues for the sharing of news items connected with the elections. Among the numerous blogs that excelled in journaling the election is Linda Ikeji’s blog; a popular blog site in Nigeria. This exposition focuses on the contributions of Linda Ikeji’s blog in the dissemination the news of the elections results. The study adopts a content analysis approach to analyze the readership of the blog within election period. The subsequent feedback from the content research aids the researcher to gauge the contributions of Linda Ikeji blog in political news journaling during the 2015 General Elections in Nigeria.
    Keywords: Lind Ikeji Blog, Social Media, 2015 Elections, Political News
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:smo:opaper:08&r=pol
  7. By: Pierre André (autre - Chercheur Indépendant); Sandrine Mesplé-Somps (LEDa - Université Paris Dauphine (Paris 9))
    Abstract: This paper studies political competition in the case of a democratization process.We present an illustrative model describing political competition when the opposition threatens the stability of the country. In some cases, our model predicts the government should invest in opposition districts to avoid political agitation. This contrasts withexisting literature on established democracies, where public funds usually target ruling, party supporters or electorally tight districts.We empirically observe the first democratic changeover in Ghana in 2000. Implement-ing a diff-in-diff strategy, we find that districts with a leading political party memberappear to receive slightly more public funds when their party is not in charge. Thisphenomenon is found in urban areas and in areas that vote the most for this leadingmember’s party. Hence it occurs in places with the potential for political agitation.
    Keywords: Politics,Ghana,Public goods,Elections
    Date: 2017–10–19
    URL: http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01619605&r=pol
  8. By: Hans Gersbach; Akaki Mamageishvili; Oriol Tejada
    Abstract: We analyze Assessment Voting, a new two-round voting procedure that can be applied to binary decisions in democratic societies. In the first round, a randomly-selected number of citizens cast their vote on one of the two alternatives at hand, thereby irrevocably exercising their right to vote. In the second round, after the results of the first round have been published, the remaining citizens decide whether to vote for one alternative or to ab- stain. The votes from both rounds are aggregated, and the final outcome is obtained by applying the majority rule, with ties being broken by fair randomization. Within a costly voting framework, we show that large elec- torates will choose the preferred alternative of the majority with high prob- ability, and that average costs will be low. This result is in contrast with the literature on one-round voting, which predicts either higher voting costs (when voting is compulsory) or decisions that often do not represent the preferences of the majority (when voting is voluntary).
    Date: 2017–12
    URL: http://d.repec.org/n?u=RePEc:arx:papers:1712.05470&r=pol
  9. By: Rostislav Turovsky (National Research University Higher School of Economics); Marina Sukhova (National Research University Higher School of Economics)
    Abstract: This research is focused on the issue of differences in results received in elections for regional and federal legislatures that are held according to the proportional system. In particular, the question of whether the authorities’ decision to favour the combination of synchronous regional and federal elections has proved effective. This research showed that, in simultaneous elections held at different territorial levels, United Russia always delivers better results at a federal level than at a regional level, while oppositional parties, conversely, perform better at a regional level than they do at a federal level. This can be explained by the phenomenon of strategic voting, according to which voters prefer to cast their votes for more stable and major players in federal elections, and that they are more likely to vote sincerely in regional elections. However, in separate elections these trends are not retained, and United Russia in particular has been noted to perform better in regional campaigns held during the inter-election period, than it did in the preceding and subsequent federal elections. Analysis of the degree of competitiveness showed that differences in the level of competitiveness in federal and regional elections are almost always lower in combined elections than in separate elections
    Keywords: regional elections, federal elections, electoral support, competitiveness, effective number of parties, party system, strategic voting, nationalisation.
    JEL: D72
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:hig:wpaper:55/ps/2017&r=pol
  10. By: Olga Orlanski; Günther G. Schulze
    Abstract: We analyze the determinants of Islamophobia using the only nation-wide anti-Islam referendum ever, which was held in Switzerland in 2009 and led to the prohibition of minarets. We find economic, environmental, and cultural factors as well as the presence of Muslims to determine voting behavior. Approval rates for the bill rise with unemployment and decrease with education, income, and the attractiveness of the location. Approval is higher in rural areas, in municipalities with a higher share of men, and in the Italian and German speaking parts of Switzerland. It is higher in municipalities with a higher share of Muslims, which strongly supports the ’religious threat’ hypothesis. We compare the voting behavior in the minaret referendum with the referendum “for democratic naturalizations”, held in 2008, in order to disentangle determinants of Islamophobia from those of xenophobia. We show that our results are robust to the estimation with ecological inference.
    Keywords: referendum, minaret referendum islamophobia, xenophobia, ecological fallacy
    JEL: D72 D78 J15
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:ces:ceswps:_6741&r=pol
  11. By: Laurent, Thibault; Le Breton, Michel; Lepelley, Dominique; de Mouzon, Olivier
    Abstract: The main purpose of this paper is to explore the consequences of the formation of either a Regional Popular Vote Interstate compact or a National Popular Vote Interstate compact on the functioning of the Electoral College. The two versions of interstate Compact which are considered here differ in only one respect: in one case the interstate compact allocates its electoral votes to the regional popular winner while in the other case it allocates these votes to the national popular winner. They both differ from the ongoing National Popular Vote Interstate Compact as it is assumed that the agreement is effective as soon as the members sign it. The decisiveness and welfare analysis are conducted for a simplified symmetric theoretical version of the Electoral College where the malapportionment problems are absent. The three most popular probabilistic models are considered and the study is conducted either from the self-interest perspective of the initiators of the interstate compact or from a general interest perspective. The analysis combines analytical arguments and simulations.
    Keywords: Electoral College; Voting Power
    JEL: D71 D72
    Date: 2017–11
    URL: http://d.repec.org/n?u=RePEc:tse:wpaper:32194&r=pol
  12. By: Michael Jetter; Bei Li
    Abstract: This paper proposes a simple framework to better understand an opposition group’s choice between peace, terrorism, and open civil conflict against the government. Our model implies that terrorism emerges if constraints on the ruling executive group are intermediate and rents are sizeable, whereas conflict looms under poor executive constraints. Analyzing annual data for up to 158 countries in a panel setting provides evidence consistent with these hypotheses. The results emerge both when considering the incidence and onset of terrorism and conflict. The corresponding magnitudes are economically sizeable. Overall, these findings can help us understand and anticipate the choices of opposition groups.
    Keywords: conflict, executive constraints, foreign aid, natural resource rents, oil rents, political institutions, rents, terrorism
    JEL: D74 F35 O11 P47 P48 Q34
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:ces:ceswps:_6747&r=pol
  13. By: Bjørnskov, Christian (Aarhus University)
    Abstract: This paper starts with the observation that almost all military dictatorships that democratize become presidential democracies. I hypothesize that military interests are able to coordinate on status-preserving institutional change prior to democratization and therefore prefer political institutions with strong veto players. Parallel civilian interests conversely suffer from coordination failure by being more diverse and les cohesive. The hypothesis therefore implies that most military democratizations are partially planned while most democratization events from civilian autocracy are either unforeseen or poorly planned. Exploring the characteristics of 111 democratization episodes between 1950 and 2015, I find a number of features broadly consistent with further theoretical predictions.
    Keywords: Dictatorship; Democracy; Political institutions
    JEL: D72 D74 P16
    Date: 2017–12–14
    URL: http://d.repec.org/n?u=RePEc:hhs:iuiwop:1194&r=pol
  14. By: Eva Ranehill; Roberto A. Weber
    Abstract: Many studies document systematic gender differences in a variety of important economic preferences, such as risk-taking, competition and pro-sociality. One potential implication of this literature is that increased female representation in decision-making bodies may significantly alter organizational and policy outcomes. However, research has yet to establish a direct connection from gender differences in simple economic choice tasks, to voting over policy and to the resulting outcomes. We conduct a laboratory experiment to provide a test of such a connection. In small laboratory “societies,” people repeatedly vote for a redistribution policy and engage in a real-effort production task. Women persistently vote for more egalitarian redistribution. This gender difference is large relative to other voting differences based on observable characteristics and is partly explained by gender gaps in preferences and beliefs. Gender voting gaps persist with experience and in environments with varying degrees of risk. We also observe policy differences between male- and female-controlled groups, though these are considerably smaller than the mean individual differences—a natural consequence of the aggregation of individual preferences into collective outcomes. Thus, we provide evidence for why substantial and robust gender differences in preferences may often fail to translate into differential policy outcomes with increased female representation in policymaking.
    Keywords: gender differences, risk, altruism, redistributive preferences, experiment
    JEL: C91 C92 J16 H23
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:ces:ceswps:_6776&r=pol
  15. By: Nicola Fontana; Tommaso Nannicini; Guido Tabellini
    Abstract: The Italian civil war and the Nazi occupation of Italy occurred at a critical juncture, just before the birth of a new democracy. We study the impact of these traumatic events by exploiting geographic heterogeneity in the duration and intensity of civil war, and the persistence of the battlefront along the “Gothic line” cutting through Northern-Central Italy. We find that the Communist Party gained votes in postwar elections where the Nazi occupation lasted longer, mainly at the expense of centrist parties. This effect persists until the late 1980s and appears to be driven by equally persistent changes in political attitudes.
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:igi:igierp:618&r=pol
  16. By: Tsz Lam Ngai (University of Cambridge, UK)
    Abstract: This article investigated the media representation of women politicians in mediated political communication in the context of Hong Kong, China. It attempted to supplement the previous feminism scholarship on media representation of women activists, which largely situated in Western contexts, with the example from East Asia. Contrary to the studies worldwide which argued that women politicians were confined to the trivialized topics in news media, this article demonstrated that the East Asian women politicians in Hong Kong, a special administrative region of China which was colonized by Britain, were visible in a larger variety of topics than their male counterparts in newspapers and they were more often directly quoted than the male politicians. Also, the number of editorials women politicians wrote to the mainstream press was significantly higher than the men did. Despite these, those articles the women are in occupied latter sections. A subtler analysis also discovered that the promising trends applied only to a few celebrity women politicians. These findings were based on a content analysis of 946 news articles in four Hong Kong newspapers. The conclusion discussed how the findings could inform readers about the stereotype towards East Asia as a highly patriarchal culture influenced by Confucianism in contemporary mediated political communication.
    Keywords: media representation, politics, gender, women in power, celebrity, East Asia
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:smo:opaper:13&r=pol
  17. By: Antonin Macé (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - CNRS - Centre National de la Recherche Scientifique - ECM - Ecole Centrale de Marseille); Rafael Treibich (University of Southern Denmark)
    Abstract: We study the design of voting rules for international unions when countries’ participation is voluntary. While efficiency recommends weighting countries proportionally to their stakes, we show that accounting for participation constraints entails overweighting some countries, those for which the incentive to participate is the lowest. When decisions are not enforceable, cooperation requires the satisfaction of more stringent constraints, that may be mitigated by granting a veto power to some countries. The model has important implications for the problem of apportionment, the allocation of voting weights to countries of differing populations, where it provides a rationale for setting a minimum representation for small countries.
    Keywords: international unions,constitutional design,veto,participation constraints
    Date: 2017–11
    URL: http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01630090&r=pol
  18. By: Graefe, Andreas; Armstrong, J. Scott; Jones, Randall J.; Cuzan, Alfred G.
    Abstract: The PollyVote uses evidence-based techniques for forecasting the popular vote in presidential elections. The forecasts are derived by averaging existing forecasts generated by six different forecasting methods. In 2016, the PollyVote correctly predicted that Hillary Clinton would win the popular vote. The 1.9 percentage-point error across the last 100 days before the election was lower than the average error for the six component forecasts from which it was calculated (2.3 percentage points). The gains in forecast accuracy from combining are best demonstrated by comparing the error of PollyVote forecasts with the average error of the component methods across the seven elections from 1992 to 2012. The average errors for last 100 days prior to the election were: public opinion polls (2.6 percentage points), econometric models (2.4), betting markets (1.8), and citizens’ expectations (1.2); for expert opinions (1.6) and index models (1.8), data were only available since 2004 and 2008, respectively. The average error for PollyVote forecasts was 1.1, lower than the error for even the most accurate component method.
    Keywords: election, forecasting, voting
    JEL: C53 D72
    Date: 2017–02–07
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:83282&r=pol
  19. By: Strunz, Sebastian; Schindler, Harry
    Abstract: In this paper, we take a political economy perspective on barriers that inhibit a transition beyond the growth-paradigm - that is, we frame transition barriers as looming distributional conflicts. Within the current paradigm, distributional conflicts are mitigated via economic growth. Hence, the solution of these distributional conflicts is a prerequisite for a successful transition. Specifically, we analyze three examples of transition barriers. First, unemployment represents the most commonly cited reason why economic growth is considered indispensable. Second, pension schemes rely on economic growth to offset demographic change. Third, alternative indicators to Gross Domestic Product (GDP) have not succeeded in replacing GDP as a standard metric of economic welfare. In each of these three examples, we identify actor-interest constellations that foster the status quo. We conclude that compensating those actors who would presumably be worse off due to a transition beyond the growth paradigm may be inevitable to mitigate and overcome the distributional effects to be triggered by the transition.
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:zbw:ufzdps:62017&r=pol
  20. By: Gregori Galofré-Vilà; Christopher M. Meissner; Martin McKee; David Stuckler
    Abstract: The current historical consensus on the economic causes of the inexorable Nazi electoral success between 1930 and 1933 suggests this was largely related to the Treaty of Versailles and the Great Depression (high unemployment and financial instability). However, these factors cannot fully account for the Nazi’s electoral success. Alternatively it has been speculated that fiscally contractionary austerity measures, including spending cuts and tax rises, contributed to votes for the Nazi party especially among middle- and upper-classes who had more to lose from them. We use voting data from 1,024 districts in Germany on votes cast for the Nazi and rival Communist and Center parties between 1930 and 1933, evaluating whether radical austerity measures, measured as the combination of tax increases and spending cuts, contributed to the rise of the Nazis. Our analysis shows that chancellor Brüning’s austerity measures were positively associated with increasing vote shares for the Nazi party. Depending on how we measure austerity and the elections we consider, each 1 standard deviation increase in austerity is associated with a 2 to 5 percentage point increase in vote share for the Nazis. Consistent with existing evidence, we find that unemployment rates were linked with greater votes for the Communist party. Our findings are robust to a range of specifications including a border-pair policy discontinuity design and alternative measures of radicalization such as Nazi party membership. The coalition that allowed a majority to form government in March 1933 might not have been able to form had fiscal policy been more expansionary.
    JEL: E6 N1 N14 N44
    Date: 2017–12
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:24106&r=pol
  21. By: Grechyna, Daryna
    Abstract: Political polarization combined with political turnover have been shown to amplify economic fluctuations (Azzimonti and Talbert, 2014). This paper analyzes a fiscal policy institution capable of reducing the volatility caused by these political frictions. We introduce the distinction between mandatory and discretionary public spending in a political model of optimal fiscal policy. We show that different legislative nature of these components of government spending leads to a divergent impact of mandatory and discretionary spending on politically-driven macroeconomic volatility. Increasing the fraction of mandatory spending in total government spending reduces the volatility; increasing the fraction of discretionary spending has the opposite effect. The presence of the legislative requirements behind the changes in mandatory public spending can explain simultaneous rise in political polarization and decline in the U.S output volatility after the 1980s.
    Keywords: business cycles; optimal fiscal policy; mandatory and discretionary public spending; macroeconomic volatility; political economy; political polarization.
    JEL: E62 H11 H30 H40
    Date: 2017–09
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:83452&r=pol
  22. By: Olessia Y. Koltsova (National Research University Higher School of Economics); Sergei V. Pashakhin (National Research University Higher School of Economics)
    Abstract: Although conflict representation in media has been widely studied, few attempts have been made to perform large-scale comparisons of agendas in the media of conflicting parties, especially for armed country-level confrontations. In this paper, we introduce quantitative evidence of agenda divergence between the media of conflicting parties in the course of the Ukrainian crisis 2013-2014. Using 45,000 messages from the online newsfeeds of a Russian and a Ukrainian TV channels, we perform topic modelling coupled with qualitative analysis to reveal crisis-related topics, assess their salience and map evolution of attention of both channels to each of those topics. We find that the two channels produce fundamentally different agenda sequences: in particular, while the Russian channel pays little attention to confrontation between the Ukrainian government and the opposition before the regime change, the Ukrainian channel is less inclined to cover armed violence in East Ukraine and refugees after the regime change.
    Keywords: news, agenda building, conflict coverage, topic modelling, Ukrainian crisis.
    JEL: Z
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:hig:wpaper:79/soc/2017&r=pol
  23. By: van de Wardt, Marc (Tilburg University, School of Economics and Management); Berkhout, Joost; Vermeulen, Floris
    Abstract: This study introduces a population-ecological approach to the entry and exit of political parties. A primary proposition of population ecology is that organizational entry and exit depends on the number of organizations already present: that is, density. We propose that political parties mainly experience competition from parties in the same ideological niche (left, centre, right). Pooled time-series analyses of 410 parties, 263 elections and 18 West-European countries largely support our expectations. We find that political parties are more likely to exit when density within their niche increases. Also there is competition between adjacent ideological niches, i.e. between centrist and right-wing niches. In contrast to our expectations, neither density nor institutional rules impact party entry. This raises important questions about the rationale of prospective entrants.
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:tiu:tiutis:d22532a6-9e27-48cc-9644-f1a8de88cfb5&r=pol

This nep-pol issue is ©2018 by Eugene Beaulieu. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at http://nep.repec.org. For comments please write to the director of NEP, Marco Novarese at <director@nep.repec.org>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.