|
on Positive Political Economics |
| By: | Norris, Pippa (Harvard U) |
| Abstract: | Doubts about the legitimacy of the 2016 U.S. elections continue to reverberate and deepen partisan mistrust in America. The perfect storm followed Republican allegations of fake news and massive voter fraud, Democratic complaints of voter suppression and gerrymandering, discontent with the way that the Electoral College anointed the presidential candidate who lost the popular vote, compounded by Comey's interventions and intelligence reports of Russian meddling. These issues raise the broader question: how serious do any perceived electoral flaws usually have to be to raise doubts not just about the process and results--or even the legitimacy of the declared winner--but about democracy itself? Do ordinary people actually care most about the quality of their elections (input legitimacy) or are they more concerned with the pocket-book economy of jobs, growth, and taxes (output legitimacy) and/or are attitudes shaped by partisan cues (the winners-losers thesis)? And how do attitudes vary among electoral winners and losers? To understand these issues, Part I outlines the theoretical and conceptual framework. Part II describes the evidence used to investigate these issues drawing upon cross-national data from the World Values Survey 6th wave in 42 diverse societies and from the 7th wave U.S. survey, as well as expert indices measuring the quality of elections. Part III establishes the key cross-national findings. Part IV presents the US results. Part V summarizes the key findings and overall implications, demonstrating that doubts about electoral integrity undermine general satisfaction with how democracy works. Paper for the panel on 'Election dynamics in the developing world' at the American Political Science Association annual convention, Boston, 4.00-5.30pm on Saturday 1 September 2018. |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp18-022&r=pol |
| By: | Ignacio Lago (Department of Political and Social Sciences, Universitat Pompeu Fabra); André Blais (Department of Political Science, University of Montréal) |
| Abstract: | We explore how the uniformity of electoral swings in the district vote within countries is affected by the level of economic and political decentralization. We rely on district-level data from OECD countries in two consecutive elections before and after the Great Recession to show that as regional governments exert more influence over the central government, districts deviate less from the overall pattern of change in support of the national incumbent party. The causal mechanism accounting for the effect of decentralization on dynamic nationalization is examined with individual panel data from national elections in Canada and Spain. |
| Date: | 2018–02 |
| URL: | http://d.repec.org/n?u=RePEc:ays:ispwps:paper1804&r=pol |
| By: | Eric Arias; Horacio Larreguy; John Marshall; Pablo Querubín |
| Abstract: | Effective policy-making requires that voters avoid electing malfeasant politicians. However, as our simple learning model emphasizing voters’ prior beliefs and updating highlights, informing voters of incumbent malfeasance may not entail sanctioning. Specifically, electoral punishment of incumbents revealed to be malfeasant is rare where voters already believed them to be malfeasant, while information’s effect on turnout is non-linear in the magnitude of revealed malfeasance. These Bayesian predictions are supported by a field experiment informing Mexican voters about malfeasant mayoral spending before municipal elections. Given voters’ low expectations and initial uncertainty, as well as politician responses, relatively severe malfeasance revelations increased incumbent vote share on average. Consistent with voter learning, rewards were lower among voters with lower malfeasance priors, among voters with more precise prior beliefs, when audits revealed greater malfeasance, and among voters updating less favorably. Furthermore, both low and high malfeasance revelations increased turnout, while less surprising information reduced turnout. |
| JEL: | D72 D73 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24888&r=pol |
| By: | Aaron A. Moore (The University of Winnipeg) |
| Abstract: | Following pressure from some sectors of civil society, the Province of Ontario passed a law in 2016 allowing municipalities to use ranked ballots to elect mayors and councillors. This change in provincial regulation, and the dialogue and debate that led to the policy change, raise important questions about the nature of municipal electoral systems in Canada. Changing an electoral system can improve voter turnout and alter electoral outcomes for the better. However, no change to an existing electoral system will address all the perceived flaws within an existing system. Change may, in fact, introduce new and unintended complications to elections and voting. Understanding the nature of different electoral systems is a necessary step when contemplating change or the status quo, as is being able to articulate clearly the objectives one hopes to achieve through electoral reform. Ultimately, proponents of change must understand that the objectives they hope to achieve through electoral reform may not be universal, and that different objectives may actually conflict with one another. This paper is intended to introduce and discuss the variety of components that constitute a municipal electoral system so that proponents for change, supporters of the status quo, and individuals simply wishing to expand their knowledge of democratic institutions may be better informed about the potential and consequences of electoral reform at the municipal level. |
| Keywords: | electoral reform; municipal elections |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:mfg:perspe:20&r=pol |
| By: | Alan de Bromhead (Queen's Management School); Alan Fernihough (Queen's Management School); Enda Hargaden (Department of Economics, University of Tennessee) |
| Abstract: | Electoral reforms in 1918 nearly tripled the number of people eligible to vote in Ireland. Following the reforms - the largest franchise extensions in UK history – the previously obscure Sinn Féin party secured 73 of Ireland's 105 seats, an outcome that presaged a guerrilla war and ultimately independence from the United Kingdom. This paper examines the relationship between the franchise extension and the election results. We find little evidence of a connection between the two. New female voters appear less likely to have supported Sinn Féin. New male voters were slightly more likely to vote for Sinn Féin, but the magnitude of this effect was small and statistically insignificant. In fact, non-voting appears particularly high for both groups of new voters. Our results suggest that the extension of the franchise cannot explain Sinn Féin's victory. We conclude their electoral success was more likely driven by a change of heart on behalf of the Irish electorate, rather than a change in its composition. |
| Keywords: | Voting; Elections; Ireland; Sinn Féin |
| JEL: | D72 N44 N94 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:ten:wpaper:2018-02&r=pol |
| By: | Norris, Pippa (Harvard U) |
| Abstract: | This study considers the evidence for 'demand-side' theories seeking to explain the outcome of the Brexit referendum and subsequent divisions in UK politics. Economic theories suggest that the Leave decision was driven mainly by the 'left-behinds' in jobs or wages, such as those living in struggling communities in the North of England, the Midlands, and Wales. By contrast cultural accounts emphasize political attitudes and values, including long-term British suspicion about the European Union project, public disgust with the political class at Westminster, anxiety about the effects of the refugee crisis and migration from other EU countries, and opposition to the government's austerity cuts. These theories can also be regarded as complimentary rather than rivals, for example if economic deprivation catalyzed resentment about immigrants and the rejection of open borders. To examine these issues, Part I sets out the electoral context and historical background in the run up to Brexit--and its implications for party competition in the UK. Drawing upon a larger book-length study, Part II sets out the arguments based on economic and cultural theories about the British electorate. Part III describes the evidence from the British Election Study panel surveys, which allows us to examine the factors dividing supporters in the Leave and Remain camps in the 2016 Brexit referendum, as well as those predicting support for UKIP from 2015-17. Part IV examines the impact of demographic control factors like age and sex, indicators of economic grievances, and the cultural profile of voters in their authoritarian and populist values, as well as their attitudes towards the Europe Union, immigration, and left-right ideology. The conclusion in Part V considers developments since Brexit and their implications for the future of populism in the UK. The main advocate of Brexit, UKIP, succeeded in attaining this goal, but then failed to achieve a decisive break through as a parliamentary party. Yet authoritarian-populism remains alive and well in post-Brexit Britain, absorbed into the bloodstream of the body politic, disrupting and dividing both major parties. |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp18-021&r=pol |
| By: | Umoh, O. J.; Onye, Kenneth U.; Atan, Johnson A. |
| Abstract: | This study investigates the political economy of fiscal policy making in West Africa by relying on a two-fold estimation technique, namely – the Instrumental variable regression model which accounts for potential endogeneity issue in the data and the Generalized Least Square regression model. The analysis covered 14 West African countries and spans over the period 1980 to 2016. The key results are as follows. First, we find evidence that fiscal policy has been more persistence in the region. This suggests that the governments of West African economies are either unwilling or just unable to adequately implement counter-cyclical fiscal policy. Second, fiscal policymaking has generally been drivenby political and institutional factor rather than on the basis of sound economic considerations. And third, the core politico-institutional factors determining fiscal persistence include corruption, government effectiveness and rule of law. |
| Keywords: | Fiscal Persistence, political stability, Corruption, West Africa |
| JEL: | E62 H3 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:88452&r=pol |
| By: | Eduardo Levy Yeyati; Lorena Moscovich; Constanza Abuin |
| Abstract: | To extend the existing literature on political polarization beyond the traditional setup (an ideologically well-defined two-party setup), we run survey experiments in the great Buenos Aires area of Argentina to explore the role of leader and party endorsement in shaping public opinion over policies, in a context of a weak and ideologically elusive party system dominated by strong personalistic leaders. We find evidence of a significant (leader as well as party) endorsement effect, regardless of the degree of ex ante polarization (so that sponsorship may introduce polarization on ex ante unpolarized issues). In addition, we document asymmetries relative to party and leader (some leaders have larger polarizing effects than others; negative identification with a leader seems to prevail over positive identification) and the ineffectiveness of co-sponsorship and "against-character" endorsement to broaden policy support. |
| Keywords: | Policy preferences, political decisions, leader endorsement, party labels, weak party systems |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:udt:wpgobi:wp_gob1_2017_10&r=pol |
| By: | Giovanni Maggi; Monika Mrázová; Peter Neary |
| Abstract: | Red-tape barriers (RTBs) are an important source of trade costs, but have received little scholarly attention to date. Here we examine the economic-political determinants of RTBs and their effects on trade. Because of their wasteful nature, RTBs have very different implications from those of more traditional trade barriers. In particular, RTBs have important impacts on the extensive margin of trade, and respond in non-standard ways to changes in tariffs and natural trade costs. We argue that taking into account the endogenous response of RTBs is crucial for understanding the effects of tariff liberalization and globalization on trade and welfare. |
| JEL: | D72 F13 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24739&r=pol |
| By: | Salome Baslandze (EIEF - Einaudi Institute for Economics a) |
| Abstract: | We study the Italian firms and their workers to answer this question. Our analysis uses a brand-new data spanning the period from 1993 to 2014 where we merge: (i) firm-level balance sheet data, (ii) the social security data on the universe of workers, (iii) patent data from the European Patent Office, (iv) registry of local politicians, and (v) detailed data on local elections in Italy. We find that firm-level political connections are widespread, especially among large firms, and that industries with a larger share of politically connected firms feature worse firm dynamics. Market leaders are much more likely to be politically connected and less likely to innovate, compared to their competitors. In addition, connections relate to higher survival and growth in employment and revenue but not in productivity – the result that we also confirm using regression discontinuity design. We build a firm dynamics model where we allow firms to invest in innovation and/or political connection to advance their productivity and to overcome certain market frictions. The model highlights the new interaction between static gains and dynamic losses from rent-seeking for aggregate productivity. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:1036&r=pol |
| By: | Fabi\'an Riquelme; Pablo Gonz\'alez-Cantergiani; Gabriel Godoy |
| Abstract: | The binomial system is an electoral system unique in the world. It was used to elect the senators and deputies of Chile during 27 years, from the return of democracy in 1990 until 2017. In this paper we study the real voting power of the different political parties in the Senate of Chile during the whole binomial period. We not only consider the different legislative periods, but also any party changes between one period and the next. The real voting power is measured by considering power indices from cooperative game theory, which are based on the capability of the political parties to form winning coalitions. With this approach, we can do an analysis that goes beyond the simple count of parliamentary seats. |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1808.07854&r=pol |
| By: | Leopoldo Fergusson; Horacio Larreguy; Juan Felipe Riaño |
| Abstract: | We develop a model of the politics of state strengthening undertaken by incumbent parties that have a comparative advantage in clientelism rather than in public good provision. The model suggests that, when politically challenged by opponents, clientelistic incumbents may oppose investing in state capacity. We provide empirical support for the model’s implications using policy decisions that reflect local state capacity choices, and a difference-in-differences identification strategy that exploits a national shock that threatened the Mexican Institutional Revolutionary Party’s hegemony in the early 1960s with varying intensity across the various Mexican municipalities. |
| Keywords: | State capacity, political competition, land allocation |
| JEL: | D72 D73 |
| Date: | 2018–08–16 |
| URL: | http://d.repec.org/n?u=RePEc:col:000518:016517&r=pol |
| By: | Facundo Piguillem (EIEF); Alessandro Riboni (Ecole Polytechnique) |
| Abstract: | Most fiscal rules can be overridden by consensus. We show that the possibility of override does not make fiscal rules ineffectual. Fiscal rules can lead the party in power to offer spending concessions to the opposition to avoid their application. Since fiscal rules determine the outside option in case of disagreement, the opposition uses fiscal rules as “bargaining chips”. This reduces the incentive for inefficient debt accumulation. We analyze three standard fiscal rules: government shutdown, budget balance and mandatory spending, and show that when political polarization is high, a government shutdown provision maximizes the bargaining power of the opposition and leads to a sizeable reduction of debt. When the degree of polarization is low, a balanced budget rule is preferable. Mandatory spending eliminates the incentive to over-accumulate debt by reducing political risk. However, it gives a considerable advantage to the initial incumbent, generating large and persistent static inefficiencies. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:732&r=pol |
| By: | Simon Alder (University of North Carolina at Chapel H); Illenin Kondo (Notre Dame) |
| Abstract: | Using the timing of China's highway network construction and political leadership cycles, we document systematic political distortions in the road infrastructure network: the birthplaces of the top officials who were in power during the network's design and implementation are more likely to be closer to the actual network compared to the optimal network arising from a quantitative spatial general equilibrium model. We then use the model to quantify the aggregate effects of distortions in the highway network. Altogether, aggregate income is 0.75 percent higher with the optimal highway network compared to the actual highway network. Counterfactual networks with political distortions simply modeled using standard iceberg transportation costs are shown to account for a portion of these welfare losses. Finally, we use light data regressions to show that political distortions to the optimal network are also associated with slower growth. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:1269&r=pol |
| By: | Manuel Foerster (University of Hamburg); Joel (J.J.) van der Weele (Universiteit van Amsterdam) |
| Abstract: | We experimentally investigate strategic communication about the impact of prosocial actions, which is central to policy debates about foreign aid or the environment. In our experiment, a “sender” receives an informative but noisy signal about the impact of a charitable donation. She then sends a message to a “receiver”, upon which both subjects choose whether to donate. The sender faces a trade-off between persuading the receiver to act and justifying her own inaction. We find evidence for both motives. Increasing the visibility of the sender’s actions increases the justification motive and makes senders more likely to report low impact, reducing giving among receivers. These results show the intimate links between reputation and com- munication in moral domains, and help understand the fraught nature of political discussions about social impact. |
| Keywords: | cheap talk; image concerns; information aggregation; charitable giving; economic experiments |
| JEL: | C91 D83 D91 |
| Date: | 2018–08–26 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20180067&r=pol |
| By: | Johnny Cotoc; Alok Johri; Cesar Sosa-Padilla |
| Abstract: | Using data from 40 nations, we obtain new stylized facts regarding the impact of polit- ical leanings of the ruling government on sovereign debt yields and fiscal policy. Left- wing governments' yields are 166 basis points higher and 23% more volatile than yields of right-wing governments. Moreover, left-wing governments face more counter-cyclical yields. Left-wing governments have higher levels of government spending and right-wing governments collect lower tax revenue as a percent of GDP. A calibrated sovereign de- fault model with elections and two politically heterogeneous policy makers who differ in the marginal impact of their fiscal choices on their re-election probabilities delivers the above-mentioned facts. |
| Keywords: | Sovereign default, Interest rate spread, Political turnover, Left-wing, Right-wing, Cyclicality of fiscal policy. |
| JEL: | F34 F41 E62 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:mcm:deptwp:2018-13&r=pol |
| By: | Mauro Caselli; Andrea Fracasso; Silvio Traverso |
| Abstract: | We study whether and to what extent the electoral dynamics in Italy over the 1994-2008 period can be explained by the development of economic factors associated with globalization. To measure the level of exposure to globalization for local labor markets, our main unit of analysis, we use the intensity of import competition from China and the presence of immigrants. Looking at parties’ political positions and employing an estimation strategy that accounts for endogeneity and time-invariant unobserved effects across local labor markets, we find that both immigration intensity and exposure to import competition from China have contributed positively to the electoral outcomes of far-right parties, whereas only the former has produced a positive effect on the votes of right-wing and traditionalist/authoritarian/nationalist parties. On the other hand, neither of them has had an effect on far-left parties. Moreover, electoral turnout has responded negatively to an increased presence of migrants. While the above effects seem to work through the mediation of labor markets, the results suggest that other mechanisms at the level of local communities are also at play. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:econwp:_10&r=pol |