nep-pol New Economics Papers
on Positive Political Economics
Issue of 2020‒03‒30
ten papers chosen by
Eugene Beaulieu
University of Calgary

  1. Do Inheritance Rules Affect Voter Turnout? Evidence from an Alpine Region By Andrea Bonoldi; Chiara Dalle Nogare; Martin Mosler; Niklas Potrafke
  2. The effect of a "none of the above" ballot paper option on voting behavior and election outcomes By Ambrus, Attila; Greiner, Ben; Zednik, Anita
  3. Co-ethnic Voters and Candidate Choice by Political Parties: Evidence from India By Tushar Bharati
  4. Highway Politics in a Divided Government : Evidence from Mexico By Selod,Harris; Soumahoro,Souleymane
  5. Political Economy of Reform and Regulation in the Electricity Sector of Sub-Saharan Africa By Imam, Mahmud I.; Jamasb, Tooraj; Llorca, Manuel
  6. Leaping into the dark: A theory of policy gambles By Anand, Kartik; Gai, Prasanna; König, Philipp Johann
  7. Political Budget Cycles in the Eurozone By Frederico Silva Leal
  8. Electoral systems and international trade policy By Serkan Kucuksenel; Osman Gulseven
  9. On the Political Economy of Free Trade By Rabah Amir; Hend Ghazzai; Rim Lahmandi-Ayed
  10. The impact of economic and political factors on popularity for France (1981- 2017) By Antoine Auberger

  1. By: Andrea Bonoldi; Chiara Dalle Nogare; Martin Mosler; Niklas Potrafke
    Abstract: We examine the relationship between inheritance rules and voter turnout. Inheritance rules are measured by entailed farms in South Tyrol: land properties whose inheritance is regulated by a law similar to the right of primogeniture. Using data for municipalities between 1998 and 2010, we show that voter turnout is high in municipalities with many entailed farms relative to population. The effect is based on local elections. If the number of entailed farms per 100 inhabitants increases by one standard deviation, voting turnout in municipal and provincial elections increases by around 1.27 and 1.43 percentage points (around 25 and 35 percent of a standard deviation). Our results suggest that entailed farm owners themselves are more likely to vote, and that entailed farms owners encourage other citizens of their municipality to participate in local elections.
    Keywords: Entailed farms, voter turnout, inheritance rules, identity, civic duty
    JEL: D72 H70 K11 Q15 Z19
    Date: 2020
  2. By: Ambrus, Attila; Greiner, Ben; Zednik, Anita
    Abstract: We investigate how voter and political candidate behavior and election results are affected by an explicit blank vote option “None of the above” (NOTA) on the ballot paper. We report evidence from two online survey experiments conducted in the weeks preceding the 2016 U.S. Presidential Election and the 2016 Austrian run-off election for President. We subjected participants either to the original ballot paper or to a manipulated ballot paper where we added a NOTA option. We find that introducing a NOTA option on the ballot increases participation and reduces the vote shares of non-establishment candidates. NOTA is chosen more frequently by voters with a protest motive, who are either unhappy with the candidate set or with the political establishment in general. Using a laboratory experiment we further explore the reaction of political candidates to the existence of a NOTA option. We replicate our field evidence that NOTA diverts votes from a protest option (e.g. an inferior candidate or policy), thus decreasing the likelihood that the protest option actually wins. However, (establishment) candidates anticipate this shift and become more likely to make unfair policy proposals when NOTA is present. As a result, a NOTA option on the ballot in our laboratory setting improves efficiency but increases inequality.
    Keywords: protest voting, expressive voting
    Date: 2020–03–17
  3. By: Tushar Bharati (Economics Discipline, Business School, University of Western Australia)
    Abstract: The paper introduces an asymmetric information candidate choice model to examine the inefficiencies arising from co-ethnic political preferences. Unlike past theoretical literature on the topic, political parties in the model internalize co-ethnic political preferences of voters and act strategically. The model predicts that a party’s choice to field a candidate of an ethnicity type depends on the ethnic composition of the constituency’s voters and the ethnicity of other rival candidates running for office. Data from parliamentary and assembly elections from the states of Bihar and Uttar Pradesh in India support the model predictions. Using exogenous changes in information flow proxied by geographical connectedness via all-weather roads, I show that lower information cost or greater connectedness implies a lower level of strategic differentiation of candidates along ethnic lines. Evidence suggests that parties disregard potential candidate’s involvement in crime to be able to differentiate along ethnic lines. As a result, worse candidates get elected to office.
    Keywords: elections; ethnic voting; political parties; crime
    JEL: D7
    Date: 2020
  4. By: Selod,Harris; Soumahoro,Souleymane
    Abstract: This paper combines local election results and geo-referenced road construction data over 1993-2012 to investigate political bias in road infrastructure investment in a democratic setting, focusing on the case of Mexico. Using a regression discontinuity design, the paper finds strong evidence of partisan allocation of federally-funded highways to municipalities that voted for the president's party in legislative races, nearly doubling the stock of highways compared to opposition municipalities. The extent of political favoritism in highway provision is stronger under divided government when the president has no majority in the legislature, suggesting political efforts to control the Congress.
    Keywords: Roads and Highways Performance,Roads&Highways,Inter-Urban Roads and Passenger Transport,Transport Services,Flood Control,Tertiary Education
    Date: 2019–01–17
  5. By: Imam, Mahmud I. (Durham University Business School, Durham University, UK); Jamasb, Tooraj (Department of Economics, Copenhagen Business School); Llorca, Manuel (Department of Economics, Copenhagen Business School)
    Abstract: As part of electricity sector reforms, Sub-Saharan African countries have established independent regulatory agencies to signal legal and political commitment to end selfregulation and provision of service by the state. The reforms aimed to encourage private investments, improve efficiency, and extend the service to the millions who lacked the service. However, after nearly two and half decades of reforms, these expectations have not been met and the electricity sectors of these countries remain undeveloped. There are anecdotes that these outcomes are due to poor design, non-credible, unpredictable regulations, and political interference. This paper studies the performance of the reforms in the context of government political ideology. We use a dynamic panel estimator and data from 45 Sub-Saharan African countries to investigate ideological differences in the effect of independent sector regulation on access to electricity and installed capacity. We find negative impact from independent regulation on installed capacity in countries with leftwing governments while we find a positive effect in countries with right-wing governments. Moreover, we find negative impact on electricity access in countries with left-wing governments. These results have interesting policy implications for attracting private sector participation to increase generation capacity and access rates especially in countries with left-wing governments.
    Keywords: independent regulation; electricity sector reform; government ideology; dynamic GMM; Sub-Saharan Africa
    JEL: D73 L51 L94 O55 P16 Q48
    Date: 2020–02–01
  6. By: Anand, Kartik; Gai, Prasanna; König, Philipp Johann
    Abstract: Why do politicians sometimes pursue policies with uncertain outcomes? We present a model in which politicians are unable to pre-commit to a status quo policy, and where investors and voters face a conflict over the division of output. Politicians may deviate from the status quo and pursue risky policy gambles in order to raise aggregate output to satisfy voters. These policy gambles may have a "populist" and self-fulfilling flavour: they can command electoral support despite being against voters' best interests. We analyse how consensus-building institutions eliminate the gamble equilibrium and enhance voter welfare. We interpret the United Kingdom's decision to leave the European Union through the lens of the model.
    Keywords: policy gambles,policy uncertainty,multiple equilibria,economic populism,Brexit
    JEL: D72 D78 P16
    Date: 2020
  7. By: Frederico Silva Leal
    Abstract: This paper provides evidencesof the electoral influence on fiscal policy in the Eurozonecountries. Using data from EA19 in 1995-2017 and a time dummy to identify election years, it was applied a Fixed Effects model to assess its impact on fiscal instruments. According to the results, the elections seemto increase both compensations to employees and other current expenditure. In addition, the politically motivated policiesseem to differ from low and highly indebted countries. Giving the electoral impact on the compensation to employees, the pro-cyclical tax strategy,and the absence of a Ricardian fiscal regime, its perceived less prudent policiesfrom the most indebted countries. Furthermore, after countries joined the EMU, policy makers beganto increase tax burden facing interest rate shocks,since they lose the ability to manipulate monetary policy.
    Keywords: Political Budget Cycles, Fiscal policy, Elections, EMU, IV-GMM
    JEL: D72 E12 E62 H62
    Date: 2020–03
  8. By: Serkan Kucuksenel; Osman Gulseven
    Abstract: We develop a simple theoretic game a model to analyze the relationship between electoral sys tems and governments' choice in trade policies. We show that existence of international pressure or foreign lobby changes a government's final decision on trade policy, and trade policy in countries with proportional electoral system is more protectionist than in countries with majoritarian electoral system. Moreover, lobbies pay more to affect the trade policy outcomes in countries with proportional representation systems.
    Date: 2020–03
  9. By: Rabah Amir (University of Iowa [Iowa City]); Hend Ghazzai (UR MASE - Modélisation et Analyse Statistique et Economique - ESSAIT - Ecole Supérieure de la Statistique et de l'Analyse de l'Information - Université de Carthage - University of Carthage); Rim Lahmandi-Ayed (LEGI - Laboratoire d'Économie et de Gestion Industrielle [Tunis] - Ecole Polytechnique de Tunisie)
    Abstract: We consider a general equilibrium model with vertical preferences for one good and two identical countries each having initially one firm. Citizens in each country are asked to vote either for openness or for autarky. Openness means that a foreign firm can sell and produce its product in the domestic country and that the domestic firm can sell and produce its product in the foreign country. The decision to open frontiers is effective only when it is bilateral. Citizens in each country are potentially consumers, workers and shareholders in the domestic firm. They differ with respect to their intensity of preference for quality and their sensitivity to effort. The regime which will prevail between countries corresponds to the majority vote in the low quality country, as we prove that citizens in the high quality country always vote for openness. The outcome thus depends in a complex way on the degree of concentration of the ownership structure in the low quality country and the relative dispersion of the citizens with respect to their intensity of preference for quality and their sensitivity to effort.
    Keywords: Globalization,Democracy,Owner- ship Structure,General Equilibrium,Vertical Preferences
    Date: 2020–03–12
  10. By: Antoine Auberger (IRGEI - Institut de Recherche sur la Gouvernance et l'Economie des Institutions - UP2 - Université Panthéon-Assas)
    Abstract: In this article, we study a popularity function for the popularity of the French political parties (1981Q2-2017Q1). At first, we suppose that voters have a retrospective behaviour according to reward-punishment model in a closed economy. We show that the unemployment rate has a significant influence on the popularity of the French political parties. We find unfavourable results for the partisan hypothesis. We also show that the economic openness has an influence on popularity. We also find a partly expected result for the asymmetry hypothesis: punishment without reward. For the political variables, we show the significant influence of the honeymoon effect, the second order elections (regional or European), and the congresses of the Socialist party.
    Keywords: popularity functions,voters' behaviour,economic situation,political variables,econometric models
    Date: 2020–03–07

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