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on Positive Political Economics |
| By: | James Feigenbaum; Alexander Hertel-Fernandez; Vanessa Williamson |
| Abstract: | Labor unions play a central role in the Democratic party coalition, providing candidates with voters, volunteers, and contributions, as well as lobbying policymakers. Has the sustained decline of organized labor hurt Democrats in elections and shifted public policy? We use the enactment of right-to-work laws—which weaken unions by removing agency shop protections—to estimate the effect of unions on politics from 1980 to 2016. Comparing counties on either side of a state and right-to-work border to causally identify the effects of the state laws, we find that right-to-work laws reduce Democratic Presidential vote shares by 3.5 percentage points. We find similar effects in US Senate, US House, and Gubernatorial races, as well as on state legislative control. Turnout is also 2 to 3 percentage points lower in right-to-work counties after those laws pass. We next explore the mechanisms behind these effects, finding that right-to-work laws dampen organized labor campaign contributions to Democrats and that potential Democratic voters are less likely to be contacted to vote in right-to-work states. The weakening of unions also has large downstream effects both on who runs for office and on state legislative policy. Fewer working class candidates serve in state legislatures and Congress, and state policy moves in a more conservative direction following the passage of right-to-work laws. |
| JEL: | D7 J5 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24259&r=pol |
| By: | Benjamin Enke |
| Abstract: | This paper studies the supply of and demand for moral values in recent U.S. presidential elections. The hypothesis is that people exhibit heterogeneity in their adherence to “individualizing” relative to “communal” moral values and that politicians' vote shares reflect the interaction of their relative moral appeal and the values of the electorate. To investigate the supply of morality, a text analysis of campaign documents classifies all candidates for the presidency since 2008 along the moral individualism vs. communalism dimension. On the demand-side, the analysis exploits two separate survey datasets to link the structure of voters' moral values to election outcomes, both across individuals within counties and across counties within states or commuting zones. The results document that heterogeneity in moral values is systematically related to voting behavior in ways that are predicted by supply-side text analyses. For example, Donald Trump's rhetoric exhibits the largest communal moral appeal among all recent presidential nominees. This pattern is matched on the demand-side, where communal values are strongly correlated with votes for Trump in the primaries, the difference in votes between Trump and past Republicans in the presidential election, and increases in voter turnout in 2016. Similarly tight connections between supply- and demand-side analyses hold for almost all contenders for the presidency in recent years, hence suggesting that morality is a key determinant of election outcomes more generally. Still, a key difference between 2016 and earlier elections appears to be the salience of moral threat in political language. |
| JEL: | D03 D72 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24268&r=pol |
| By: | Martina Burmann; Marcus Drometer; Romuald Méango |
| Abstract: | Despite the recognition that asylum policies are partly determined by political economy factors in the destination country, there is little empirical evidence on the precise linkages between those political factors and asylum policies. We shed light on this issue by examining the impact of elections and parties on first-time asylum applications. Our evidence is based on a large bilateral panel data set comprising 12 European destination countries and their 51 most relevant origin countries during the time period 2002 to 2014. Our findings suggest that the number of asylum applicants under left- and right-wing parties converges before elections and differs thereafter. This result is robust to several different specifications and suggests that both left- and rightwing cabinets choose moderate policies before the election and less moderate policies after the election. |
| Keywords: | Electoral cycles, migration policies |
| JEL: | H11 D72 F22 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ifowps:_245&r=pol |
| By: | Anthony Edo; Yvonne Giesing; Jonathan Öztunc; Panu Poutvaara |
| Abstract: | Immigration has become one of the most divisive political issues in the United States, the United Kingdom, France and several other Western countries. We estimate the impact of immigration on voting for far-left and far-right parties in France, using panel data on presidential elections from 1988 to 2012. To derive causal estimates, we instrument more recent immigration flows by past settlement patterns in 1968. We find that immigration increases support for far-right candidates and has no robust effect on far-left voting. The increased support for far-right candidates is driven by low-skilled immigrants from non-Western countries. |
| Keywords: | Voting, immigration, political economy |
| JEL: | D72 F22 J15 P16 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ifowps:_244&r=pol |
| By: | Cooper, Zack; Kowalski, Amanda; Neff Powell, Eleanor; Wu, Jennifer |
| 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: | D72 H51 I10 P16 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:86620&r=pol |
| By: | Björn Kauder; Niklas Potrafke; Heinrich Ursprung |
| Abstract: | Using a representative survey of German university students, we confirm that proclaimed support for environment protection policies depends on socio-cultural factors and political ideology. Unlike most related studies for other countries, we find that the environmental policy stance of German partisans does not follow the left-right cleavage. Only about 25% of the social-democratic partisans wholeheartedly support environment protection policies, whereas 50% of the green partisans, who, in Germany, also belong to the political left, do so; and when controlling for socio-cultural influences, social-democratic partisans become undistinguishable from Christian-conservative and market-oriented partisans. Focusing on behavioral influences, we find that some of the respondents’ psychological traits are not filtered through their political ideology but directly influence their proclaimed attitudes towards environment protection policies. We identify as important behavioral determinants the locus of control and psycho-logical traits that capture the respondents’ susceptibility to making use of expressive rhetoric. |
| Keywords: | Environment protection, political preferences, ideology, identity, expressive behavior. |
| JEL: | D72 P16 Q51 Q58 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ifowps:_254&r=pol |
| By: | Samuel Bazzi (Boston University, CEPR, BREAD); Matthew Gudgeon (Boston University) |
| Abstract: | Policymakers in diverse countries face the persistent challenge of managing ethnic divisions. We argue that redrawing subnational political boundaries can fundamentally reshape these divisions. We use a natural policy experiment in Indonesia to show that changes in the political relevance of ethnic divisions have significant effects on conflict in the short- to medium-run. While redistricting along group lines can increase social stability, these gains are undone and even reversed in newly polarized units. Electoral democracy further amplifies these effects given the large returns to initial control of newly created local governments in settings with ethnic favoritism. Overall, our findings show that the ethnic divisions underlying widely-used diversity measures are neither fixed nor exogenous and instead depend on the political boundaries within which groups are organized. These results illustrate the promise and pitfalls of redistricting policy in diverse countries where it is not feasible for each group to have its own administrative unit. |
| Keywords: | Conflict, Decentralization, Ethnic Divisions, Polarization, Political Boundaries |
| JEL: | D72 D74 H41 H77 O13 Q34 |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:bos:wpaper:wp2018-005&r=pol |
| By: | John Gibson (University of Waikato); Bonggeun Kim (Seoul National University) |
| Abstract: | The effect of home ownership on political participation is examined using longitudinal data from New Zealand. We study political party membership, and if and how individuals voted in six General Elections, using validated data. There is a positive correlation between being a home owner and ever voting, and between political party membership and the local home ownership rate. Individual home ownership and the home ownership rate negatively correlate with voting for left-wing political parties. But once the longitudinal nature of the data are exploited, using fixed effects specifications, these significant correlations disappear. This change in the results suggests that unobserved factors that predispose people to be a home owner also affect their political participation. |
| Keywords: | home ownership; omitted variables; political participation; voting |
| Date: | 2018–02–10 |
| URL: | http://d.repec.org/n?u=RePEc:wai:econwp:18/02&r=pol |
| By: | Bruno Deffains (CRED - Centre de Recherches en Economie et Droit - UP2 - Université Panthéon-Assas - M.E.N.E.S.R. - Ministère de l'Éducation nationale, de l’Enseignement supérieur et de la Recherche, IUF - Institut Universitaire de France - M.E.N.E.S.R. - Ministère de l'Éducation nationale, de l’Enseignement supérieur et de la Recherche, University of Liverpool [Liverpool]); Romain Espinosa (CRED - Centre de Recherches en Economie et Droit - UP2 - Université Panthéon-Assas - M.E.N.E.S.R. - Ministère de l'Éducation nationale, de l’Enseignement supérieur et de la Recherche); Christian Thöni (UNIL - Université de Lausanne) |
| Abstract: | We explore the impact of the self-serving bias on the supply and demand for redistribution. We present results from an experiment in which participants decide on redistribution after performing a real e↵ort task. Dependent on individual performance, participants are divided into two groups, successful and unsuccessful. Participants' success is exogenously determined, because they are randomly assigned to either a hard or easy task. However, because participants are not told which task they were assigned to, there is ambiguity as to whether success or failure should be attributed to internal or external factors. Participants take two redistribution decisions. First, they choose a supply of redistribution in a situation where no personal interests are at stake. Second, they choose a redistributive system behind a veil of ignorance. Our results confirm and expand previous findings on the self-serving bias: successful participants are more likely to attribute their success to their e↵ort rather than luck, and they opt for less redistribution. Unsuccessful participants tend to attribute their failure to external factors and opt for more redistribution. We demonstrate that the self-serving bias contributes to a polarization of the views on redistribution. |
| Keywords: | polarization,Redistribution,self-serving bias,experimental,veil of ignorance |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-01634208&r=pol |
| By: | Niamh Hardiman; Saliha Metinsoy |
| Abstract: | European countries have been required to formulate a national preference in relation to the EU Financial Transaction Tax. The two leading approaches to explaining how the financial sector makes its views felt in the political process – the structural power of the financial services sector based on potential disinvestment, and its instrumental power arising from direct political lobbying – fall short of providing a comprehensive account. The missing link is how and why policy-makers might be willing to adopt the priorities of key sectors of the financial services industry. We outline how two levels of ideational power might be at work in shaping outcomes, using Ireland as a case study. We argue firstly that background systems of shared knowledge that are institutionalized in policy networks generated broad ideational convergence between the financial sector and policymakers over the priorities of industrial policy in general. Secondly, and against that backdrop, debate over specific policy choices can leave room for a wider range of disagreement and indeed political and ideational contestation. Irish policymakers proved responsive to industry interests in the case of the FTT, but not for the reasons normally given. This work seeks to link literatures in two fields of inquiry. It poses questions for liberal intergovernmentalism in suggesting that the translation of structurally grounded material interests into national policy preferences is far from automatic, and argues that this is mediated by ideational considerations that are often under-estimated. It also contributes to our understanding of how constructivist explanations of policy outcomes work in practice, through a detailed case study of how material and ideational interests interact. |
| Keywords: | Economic integration; Multinational firms; International business; Globalization; Business taxes and subsidies; Intergovernmental relations |
| JEL: | F02 F15 F23 F55 H25 H70 P16 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:rru:oapubs:10197/9205&r=pol |
| By: | Paola Azar Dufrechou (Departament d'Economia Aplicada, Universitat Autonoma de Barcelona; Institute of Economics, Universidad de la República-Uruguay) |
| Abstract: | Based on the compilation of Uruguayan department-level data, this paper argues that the extent of fiscal commitment to primary education during the first half of the 20th century can be explained by the interests of tactically motivated politicians. The empirical test relies on panel data fixed effects models covering 18 Uruguayan departments over 40 years. The main findings reveal that political motivations have had a significant role in schooling provision across the territory. Throughout the period, the incumbent government seems to have used the resource allocation in primary education both to reward its core supporters and to persuade political opponents. |
| Keywords: | primary education, pork-barrel, economic history |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:uab:wprdea:wpdea1801&r=pol |
| By: | Coban, Mustafa |
| Abstract: | Combining the link between ethnic heterogeneity, attitudes towards immigrants, and the support of redistribution, predictions are made about natives' preference for redistribution depending on interethnic contact, perceived outgroup threats, and natives' social distance from immigrants. The econometric specification explicitly considers the simultaneous effects of ethnic heterogeneity on attitudes towards immigrants and those attitudes on the redistribution preference. Applying bivariate recursive probit estimations enables the decomposition of marginal effects into a direct and an indirect effect. The empirical assessment, based on a cross-section of 18 European countries from 2014, shows that natives' perceived outgroup threats directly decrease their preference for redistribution, whereas interethnic contact indirectly increases their redistribution preference through less anti-immigrant attitudes. If immigrants are perceived as a threat to the culture or social life in a country, a native's probability of supporting more governmental redistribution decreases by 6.4 percent or 8.2 percent, respectively. However, if ethnic heterogeneity rises, this probability increases by 0.8 percent. In contrast, there is no significant association between natives' social distance from immigrants and their preference for redistribution. These results are robust to IV estimation strategies which control for the possibility of natives' selective out-migration and reverse causality. Taking the natives' and immigrants' average incomes into account, the ethnic income gap between natives and immigrants strengthens the negative impact of perceived outgroup threats if immigrants earn much less than natives in a country. |
| Keywords: | preference for redistribution,immigration,ethnic diversity,attitudes towards immigrants,bivariate recursive probit |
| JEL: | C30 D31 D63 D72 F22 H20 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wuewwb:137&r=pol |
| By: | Petr Huber (Austrian Institute for Economic Research (WIFO) and Faculty of Business and Economics, Mendel University in Brno.); Josef Montag (International School of Economics, Kazakh-British Technical University and Department of Economics, Mendel University in Brno) |
| Abstract: | We study whether the positive effects of homeownership on political participation and social capital, found in developed market economies, extend to post-communist countries. We find that homeownership is strongly related to higher participation in local-level and national elections. In post- communist countries, homeownership is also related to higher social trust. However, the positive association between homeownership and volunteering found in developed market economies does not extend to post-communist countries. Together, our results corroborate that homeownership is associated with positive social benefits. However, these effects are highly heterogeneous and context- dependent. |
| Keywords: | Homeownership, social capital, political participation, post-communist countries |
| JEL: | D62 D72 P14 P26 |
| Date: | 2018–02 |
| URL: | http://d.repec.org/n?u=RePEc:men:wpaper:74_2018&r=pol |
| By: | Berggren, Niclas (Research Institute of Industrial Economics (IFN)); Bjørnskov, Christian (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Since the early 1980s a wave of liberalizing reforms has swept over the world. While the stated motivation for these reforms has usually been to increase economic efficiency, some critics have instead inferred ulterior motives and a desire to enrich certain (already rich) people at the expense of others. This critique, coupled with the claim that many of the reforms have been undertaken during different crises so as to bypass potential opponents, suggests that people will dislike the reforms and even be less satisfied with democracy as such. We test this hypothesis empirically, using panel data from 30 European countries in the period 1993–2015. The dependent variable is the average satisfaction with democracy, while the reform measures are constructed as distinct changes in four policy areas: government size, the rule of law, openness and regulation. Our results indicate that while reforms of government size are not robustly related to satisfaction with democracy, reforms of the other three kinds are – and in a way that runs counter to the anti-liberalization claims. Reforms that reduce economic freedom are generally related to satisfaction with democracy in a negative way, while reforms that increase economic freedom are positively associated with satisfaction with democracy. Voters also react more negatively to left-wing governments introducing reforms that de-liberalize. It thus seems as if the hypothesis of a general negative reaction towards liberalizing reforms taking the form of reduced satisfaction with democracy does not stand up to empirical scrutiny, at least not in our European sample. |
| Keywords: | Government satisfaction; Reforms; Crisis; Public choice; Voting; Institutions |
| JEL: | D02 D72 H11 P11 Z18 |
| Date: | 2018–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1197&r=pol |