nep-pol New Economics Papers
on Positive Political Economics
Issue of 2018‒07‒30
fourteen papers chosen by
Eugene Beaulieu
University of Calgary

  1. Do Campaign Contributions from Farmers Influence Agricultural Policy? Evidence From a 2008 Farm Bill Amendment Vote to Curtail Cotton Subsidies By Scott Callahan
  2. Electoral Institutions and Intraparty Cohesion By Konstantinos Matakos; Riikka Savolainen; Orestis Troumpounis; Janne Tukiainen; Dimitrios Xefteris
  3. Confirmation bias and signaling in Downsian elections By Antony Millner; Hélène Ollivier; Leo Simon
  4. The Effects of Political Competition on the Generosity of Public-Sector Pension Plans By Sutirtha Bagchi
  5. The political economy of non-tariff measures By Cristina Herghelegiu
  6. The Blank and the Null: An examination of non-conventional voting choices By Rodrigo Martins
  7. Extensions of the Simpson voting rule to the committee selection setting By Daniela Bubboloni; Mostapha Diss; Michele Gori
  8. Majority Voting in a Model of Means Testing By Cardak, Buly A.; Glomm, Gerhard; Ravikumar, B.
  9. Political Economy of Taxation, Debt Ceilings, and Growth By Tetsuo Ono; Yuki Uchida
  10. Conditionality, democracy and institutional weakness: the Euro-crisis trilemma By Featherstone, Kevin
  11. The Dimensions of Consensus By Benny Moldovanu; Alex Gershkov; Xianwen Shi
  12. The Effects of Political Reservations on Credit Access and Borrowing Composition: New Evidence from India By Ao, Chon-Kit; Chatterjee, Somdeep
  13. Do Voters Prefer Gender Stereotypic Candidates? Evidence from a conjoint survey experiment in Japan By ONO Yoshikuni; YAMADA Masahiro
  14. Guns, environment and abortion: how single-minded voters shape politicians decisions By Bouton, Laurent; Conconi, Paola; Pino, Francisco J; Zanardi, Maurizio

  1. By: Scott Callahan
    Abstract: Farmers in the United States receive billions of dollars per year from federal farm support programs. While the nature of these programs has evolved since the Great Depression, they both persist and expand with the passage of every farm bill. This paper studies the political activities of individual farmers and the political action committees that represent their interests by exploiting a vote to amend the 2008 farm bill that, had it passed, would have curtailed a cotton subsidy program. I find evidence that cotton farmers contribute substantially to campaigns in the House of Representatives. The more a cotton farmer receives in farm subsidies, the more likely they are to make political contributions. Further, there is evidence that cotton farmers contribute substantially to non-local races, and that these contribution patterns closely resemble those of cotton political action committees. Results on the effectiveness of these contributions in influencing legislative outcomes is inconclusive. Key Words: Agricultural Policy, Lobbying, Rent Seeking, Campaign Finance
    JEL: Q18 D72
    Date: 2018
  2. By: Konstantinos Matakos; Riikka Savolainen; Orestis Troumpounis; Janne Tukiainen; Dimitrios Xefteris
    Abstract: We study parties' optimal ideological cohesion across electoral rules, when the following trade-off is present: A more heterogenous set of candidates is electorally appealing (catch-all party), yet, it serves policy-related goals less efficiently. When the rule becomes more disproportional, thus inducing a more favorable seat allocation for the winner, the first effect is amplified, incentivizing parties to be less cohesive. We provide empirical support using a unique data-set that records candidates' ideological positions in Finnish municipal elections. Exploiting an exogenous change of electoral rule disproportionality at different population thresholds, we identify the causal effect of electoral rules on parties' cohesion.
    Keywords: Electoral systems; ideological heterogeneity; party cohesion; policy-motivated parties; proportional representation; regression discontinuity design
    JEL: C21 C72 D02 D72
    Date: 2018–07
  3. By: Antony Millner (LSE - London School of Economics and Political Science); Hélène Ollivier (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique); Leo Simon (University of California [Berkeley])
    Abstract: How do voters' behavioural biases affect political outcomes? We study this question in a model of Downsian electoral competition in which office-motivated candidates have private information about the benefits of policies, and voters may infer candidates' information from their electoral platforms. If voters are Bayesian, candidates have strategic incentives to `anti-pander' { they choose platforms that are more extreme than is justified by their private beliefs. However, anti-pandering incentives are ameliorated if voters'inferences are subject to confirmation bias. Voter confirmation bias can thus counteract distortions due to the strategic interaction between candidates, potentially leading to welfare improvements. Indeed, we show that all observers, whether biased or Bayesian, would like the representative voter in our model to exhibit more confirmation bias than they do themselves.
    Keywords: JEL Codes: D72,signaling,electoral competition,pandering,D91 Keywords: Confirmation bias
    Date: 2017–11–09
  4. By: Sutirtha Bagchi (Department of Economics, Villanova School of Business, Villanova University)
    Abstract: In politically competitive jurisdictions, there can be strong electoral incentives to increase the generosity of public pensions and simultaneously, to not fund them fully, in order to keep taxes low. I examine the relationship between political competition and generosity of public pensions using a panel dataset for 3,000 municipal plans from Pennsylvania for the period 2003–2013. I find that as the level of political competition in a municipality increases, pension plans become more generous but this relationship holds true only for plans run by municipal governments. A one standard deviation increase in the level of political competition is associated with an increase in the generosity of municipal plans by about 3 percent ($426–507/retiree/year) with no effect on plans run by municipal authorities. The effects of political competition are driven by municipalities that have a higher proportion of uninformed voters and are absent for defined contribution plans.
    Keywords: Public-sector pensions; Political competition; Generosity of benefits; Defined benefit pensions; Defined contribution pensions
    JEL: H75 J45
    Date: 2018–07
  5. By: Cristina Herghelegiu (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Over the last decades, non-tari measures (NTMs) have seen an important upsurge. How- ever, little research has focused on the political economy of non-tariff protection, and the existing studies are mainly based on a single country or a specific type of measures. This paper seeks to fill the gap by empirically evaluating the determinants of NTMs in several countries, both developed and developing. Overall results show certain protectionist purposes behind the adoption of NTMs. This conclusion is reinforced for restrictive measures (i.e. subject to trade concerns), but does not hold for non-restrictive measures, suggesting the legitimate goal of several NTMs. Furthermore, transnational lobbying, defined as the influence exerted by national business groups during the Ministerial Conferences - the highest authority of the World Trade Organization (WTO) - increases the probability of adopting NTMs in both developed and developing countries.
    Keywords: Non-tariff Measures,Political Economy,International Trade,Lobbying
    Date: 2017–10
  6. By: Rodrigo Martins (CeBER and Faculty of Economics of the University of Coimbra)
    Abstract: This paper analyses the determinants of null and blank voting at the 2011 Portuguese legislative elections. An extensive datasets at the parish level and a fractional regression model estimator are used to estimate both voting alternatives. The results found point to some common explanatory patterns as well as to important differences between the two choices. Evidence also indicates that the performance of the local economy, especially unemployment, is important but only for the explanation of blank variations and in more urban areas, where more sophisticated voters reside. Furthermore, results point to the presence of a relevant degree of persistence in both choices and indicate that past electoral choices influence both voting choices in a way that seems to suggest the existence of protest motives.
    Keywords: Invalid voting; blank ballots; null ballots; Portugal; elections.
    JEL: D72 H7
    Date: 2017–06
  7. By: Daniela Bubboloni (Università degli Studi di Firenze [Firenze]); Mostapha Diss (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique); Michele Gori (Università degli Studi di Firenze [Firenze])
    Abstract: Committee selection rules are procedures selecting sets of candidates of a given size on the basis of the preferences of the voters. There are in the literature two natural extensions of the well-known single-winner Simpson voting rule to the multiwinner setting. The first method gives a ranking of candidates according to their minimum number of wins against the other candidates. Then, if a fixed number k of candidates are to be elected, the k best ranked candidates are chosen as the overall winners. The second method gives a ranking of committees according to the minimum number of wins of committee members against committee nonmembers. Accordingly, the committee of size k with the highest score is chosen as the winner. We propose an in-depth analysis of those committee selection rules, assessing and comparing them with respect to several desirable properties among which unanimity, fixed majority, non-imposition, stability, local stability, Condorcet consistency, some kinds of monotonicity, resolvability and consensus committee. We also investigate the probability that the two methods are resolute and suffer the reversal bias, the Condorcet loser paradox and the leaving member paradox. We compare the results obtained with the ones related to further well-known committee selection rules. The probability assumption on which our results are based is the widely used Impartial Anonymous Culture.
    Keywords: Multiwinner Elections, Committee Selection Rule, Simpson Voting Rule, Paradoxes, Probability
    Date: 2018
  8. By: Cardak, Buly A. (College of Arts, Social Sciences and Commerce La Trobe Business School); Glomm, Gerhard; Ravikumar, B. (Federal Reserve Bank of St. Louis)
    Abstract: We study a model of endogenous means testing where households differ in their income and where the in-kind transfer received by each household declines linearly with income. Majority voting determines the two dimensions of public policy: the size of the welfare program and the means-testing rate. We establish the existence of a sequential majority voting equilibrium, when the households vote first on the size of the program and then on the means-testing rate. We show that the means-testing rate increases with the size of the program but the fraction and the identity of the households receiving the transfers are independent of the program size.
    Keywords: Sequential majority voting; Means testing; Political support; Targeting
    JEL: D70 D72 H20
    Date: 2018–06–01
  9. By: Tetsuo Ono (Graduate School of Economics, Osaka University); Yuki Uchida (Faculty of Economics, Seikei University)
    Abstract: This study presents an overlapping-generations model with physical and human capital accumulation and considers probabilistic voting over capital and labor taxes and public debt to finance public education expenditure. Our analysis shows that the greater political power of the old induces the government to raise the labor tax on the young and lower the capital tax on the old as well as issue debt. The analysis also shows that the introduction of a debt ceiling rule calls for a rise in the labor tax and thus lowers the welfare of the currently working generation. However, it increases the growth rate, and this growth effect raises the welfare of future generations. These benefits last for a long period even if the rule is imposed only for a limited time.
    Keywords: Capital taxation, Public debt, Economic growth, Probabilistic vot- ing, Overlapping-generations model
    JEL: D70 E24 H63
    Date: 2018–07
  10. By: Featherstone, Kevin
    Abstract: The sovereign debt crises of the eurozone have raised a set of systemic challenges for the European Union (EU) that questions the credibility and legitimacy of its governance across two levels, European and domestic. The challenges are both instrumental and normative. The critical case in these respects is Greece: in 2015, it needed a third bail-out, but it also launched a political confrontation with the EU following the election of a leftist-led government. The political drama made the enduring challenges even more acute. Firstly, there were (and are) questions of leadership. How could the eurozone provide leadership and lever domestic reform to keep Greece inside the euro? Was there the political will to do so, at either the European or national levels? Further, there was the institutional challenge that stems from the juxtaposition of complex and disparate leadership at the EU level with low-quality institutions for policy delivery domestically. Beyond the structural conditions, there are normative questions of the terms of the rescue, but also issues of the accountability and legitimacy of the decision-making process. What can elections decide in a state under an adjustment programme? Together, these challenges pose a conundrum that is existential in nature for the EU: a trilemma in which the external leadership of reforms via conditionality confronts national democratic choice and the operational deficiencies of weak domestic institutions...
    JEL: J1
    Date: 2016–09–01
  11. By: Benny Moldovanu; Alex Gershkov; Xianwen Shi
    Abstract: We study a multi-dimensional collective decision under incomplete information. Agents have Euclidean preferences and vote by simple majority on each issue (dimension), yielding the coordinate-wise median. Judicious rotations of the orthogonal axes - the issues that are voted upon - lead to welfare improvements. If the agents' types are drawn from a distribution with independent marginals then, under weak conditions, voting on the original issues is not optimal. If, in addition, the marginals are identical, then voting first on the total sum and next on the differences is often welfare superior to voting on the original issues. We also provide various lower bounds on incentive efficiency: in particular, if agents' types are drawn from a log-concave density with symmetric marginals, a second-best voting mechanism attains at least 88% of the first-best efficiency.
    Keywords: multi-dimensional voting , welfare , bundling
    JEL: D82 D71
    Date: 2018–07
  12. By: Ao, Chon-Kit; Chatterjee, Somdeep
    Abstract: We estimate the impacts of mandated political reservation for minorities on household credit access and borrowing behavior. To identify causal effects, we exploit the exogenous state-time variation in the allocation of constituencies (electoral districts) to the two reserved minority groups in Indian states. Using a household level panel data with observations before and after the redistricting, we find that the effect is concentrated on the disadvantaged population groups. Political reservation for Scheduled Tribes (STs) increases household probability of getting a loan by 3.7 percentage points, while political reservation for Scheduled Castes (SCs) has no effect on the likelihood of getting a loan. However, conditional on having a loan, reservation for SCs does lead to fewer but larger loans. We also find considerable changes in household borrowing composition.
    Keywords: Affirmative action,Political reservation,Credit access,Borrowing composition
    JEL: D78 J15 J78 O12
    Date: 2018
  13. By: ONO Yoshikuni; YAMADA Masahiro
    Abstract: The striking under-representation of women in Japan has been partly attributed to gender stereotypes and prejudice toward female leadership among voters. We examine whether and to what extent candidates get rewarded or punished when they deviate from the behavioral expectations associated with their gender roles and images. Our conjoint experiment results in Japan demonstrate that not only are female candidates disadvantaged compared to their male counterparts, but also that they could lose support when they diverge from gender-based behavioral expectations. Our findings suggest that female candidates face a difficult dilemma in that they must weigh the cost of losing support for failing to conform to gender-based expectations, against the general loss of support they would incur for conforming to these expectations.
    Date: 2018–06
  14. By: Bouton, Laurent; Conconi, Paola; Pino, Francisco J; Zanardi, Maurizio
    Abstract: We study how electoral incentives affect policy choices on secondary issues, which only minorities of voters care intensely about. We develop a model in which office and policy motivated politicians choose to support or oppose regulations on these issues. We derive conditions under which politicians flip-flop, voting according to their policy preferences at the beginning of their terms, but in line with the preferences of single-issue minorities as they approach re-election. To assess the evidence, we study U.S. senators' votes on gun control, environment, and reproductive rights. In line with our model's predictions, election proximity has a pro-gun effect on Democratic senators and a proenvironment effect on Republican senators. These effects only arise for non-retiring senators, who represent states where the single-issue minority is of intermediate size. Also in line with our theory, election proximity has no impact on senators' decisions on reproductive rights, because of the presence of single-issue minorities on both sides.
    Keywords: electoral incentives; environment; gun control; reproductive rights
    JEL: D72 I18 Q00
    Date: 2018–03–01

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