nep-pol New Economics Papers
on Positive Political Economics
Issue of 2020‒06‒29
fifteen papers chosen by
Eugene Beaulieu
University of Calgary

  1. Electoral Turnout During States of Emergency and Effects on Incumbent Vote Share By Marco Frank; David Stadelmann; Benno Torgler
  2. Voting or abstaining in "managed" elections? A field experiment in Bangladesh By Ahmed, Firoz; Hodler, Roland; Islam, Asadul
  3. Gender voting gap in the dawn of urbanization: evidence from a quasi-experiment with Greek special elections By Efthyvoulou, Georgios; Kammas, Pantelis; Sarandides, Vassilis
  4. Political Institutions and Policy Responses During a Crisis By Gaurav Chiplunkar; Sabyasachi Das
  5. Corruption and Extremism By Giommoni, Tommaso; Morelli, Massimo; Nicolò, Antonio
  6. Political connections and the super-rich in Poland By Katarzyna Sałach; Michał Brzeziński
  7. The Seeds of Ideology: Historical Immigration and Political Preferences in the United States By Paola Giuliano; Marco Tabellini
  8. Divided They Fall. Fragmented Parliaments and Government Stability By Carozzi, Felipe; Cipullo, Davide; Repetto, Luca
  9. A Political Model of Trust By Agranov, Marina; Eilat, Ran; Sonin, Konstantin
  10. Stereotypes and Politics By Pedro Bordalo; Marco Tabellini; David Y. Yang
  11. Fiscal Rules as Bargaining Chips By Piguillem, Facundo; Riboni, Alessandro
  12. Gender Differences in Campaigning under Alternative Voting Systems: Evidence from a Quantitative Text Analysis of Election Manifestos in Japan By ONO Yoshikuni; MIWA Hirofumi
  13. The Long-Run Effects of School Racial Diversity on Political Identity By Stephen B. Billings; Eric Chyn; Kareem Haggag
  14. Trade Policy and National Identity: Why Keynes Was Opposed to Protectionist Policies? By Elise S. Brezis
  15. Attitude towards Immigrants: Evidence from U.S. Congressional Speeches By Bose, Neha

  1. By: Marco Frank; David Stadelmann; Benno Torgler
    Abstract: In March 2020, the second ballot of local elections in the German state of Bavaria was held under an official state of emergency due to the Covid-19 pandemic. Bavarian mayors are elected by majority rule in two-round (runoff) elections. Between the first and second ballot of the election, the state government announced a state of emergency with drastic measures to fight the spread of Covid-19, including a shutdown of public life and restrictions to individual mobility. We employ a difference-in-difference setting to contrast turnout of the first and second ballot in 2020 with the first and second ballots from previous elections. The state of emergency led to an increase in turnout of 10 percentage points. This increase in turnout is robust and there is no relevant heterogeneity of the increase across municipalities. We argue that voting is an act of identifying with the collectivity of society which seemed to increase under adverse circumstances. In addition, the emergency induced higher turnout from the difference-in-difference setting is employed as an instrument to analyze the effect of turnout on the vote share of incumbents. Controlling for party affiliations and other factors, the results indicate that incumbents tend to profit marginally from higher turnout.
    Keywords: Covid-19; turnout; mayoral elections; voting in crises
    JEL: D72
    Date: 2020–06
  2. By: Ahmed, Firoz; Hodler, Roland; Islam, Asadul
    Abstract: Many governments in weak democracies countries "manage" the electoral process to make their defeat very unlikely. We aim to understand why citizens decide to vote or abstain in managed elections. We focus on the 2018 general election in Bangladesh and randomize the salience of the citizens' views (i) that election outcomes matter for policy outcomes and (ii) that high voting participation increases the winning party's legitimacy. These treatments increase voting participation in government strongholds and decrease participation in opposition strongholds. The legitimacy treatment has stronger effects. These results have important implications for get-out-the-vote and information campaigns in weak democracies.
    Keywords: Bangladesh; Electoral authoritarianism; field experiment; managed/authoritarian elections; voting behavior
    JEL: C93 D72
    Date: 2020–04
  3. By: Efthyvoulou, Georgios; Kammas, Pantelis; Sarandides, Vassilis
    Abstract: The electoral law of 31 May 1952 extended the voting rights to all adult women in Greece. This paper examines the impact of women’s enfranchisement on party vote shares by employing a unique dataset of 385 communities located in seven prefectures in Greece where by-elections took place in 1953 and 1954 (for strictly exogenous reasons). To estimate causal effects, we exploit the observed heterogeneity in the proportion of women in the electorate across communities as the identifying source of variation, and employ a difference-in-differences design that holds unobserved local characteristics fixed. Our results provide strong evidence in favour of the “traditional gender voting gap” (women voting more conservatively compared to men) in the urban prefecture of Thessaloniki, and no evidence of gender voting differences in the remaining (six) predominantly rural prefectures of our sample. Our results also reveal that the existence of a gender voting gap is highly conditional upon the proportion of economically inactive women; that is, women tend to vote for right parties when they are outside of the labour force. Interestingly, when we account for this conditionality, a suffrage-induced pro-right shift can also be observed in communities outside Thessaloniki. Building on the economic bargaining models of the family, we argue that, in an economic environment characterized by limited demand for female labour force participation, women support more vigorously the sanctity and the strength of family values and tend to vote more conservatively compared to men.
    Keywords: women's suffrage; political preferences; women's labour market participation
    JEL: D72
    Date: 2020–03–01
  4. By: Gaurav Chiplunkar (University of Virginia); Sabyasachi Das (Ashoka University)
    Abstract: Do countries with differing political institutions respond differently to a national crisis? The coronavirus pandemic, where almost all countries were hit by the same crisis in a short span of time, provides a rare opportunity to answer this question. For a sample of 125 countries, we use high frequency data on two measures of policy response- (i) containment policies, relating to closure of public spaces and restrictions on movement of people, and (ii) health policies, relating to public information campaigns, testing and contact tracing, to examine their policy response to the crisis. We show that: first, non-democracies have more stringent containment and health policies prior to their first COVID-19 case. However, after registering their first case, democracies either close this gap (in containment policies), or surpass non-democracies (in health policies) within a week. Second, policy responses do not differ by governance systems (presidential or parliamentary) in democracies. However, elected leaders who performed better in the last election or face their next election farther in the future are more aggressive in their policy response. Third, democracies with greater media freedom respond more slowly in containment policies, but are more aggressive in health policies. Lastly, more conducive political norms (such as trust in the elected government) systematically predict a more aggressive response in both containment and health policies. Our analysis therefore suggests that political institutions and the incentives of the political leaders embedded therein, significantly shape the policy response of governments to a national crisis.
    Keywords: Democracy, Autocracy, Electoral Systems, COVID-19
    Date: 2020–06
  5. By: Giommoni, Tommaso; Morelli, Massimo; Nicolò, Antonio
    Abstract: When should we expect an opposition group to select an extremist leader or representative? This paper shows the important role of corruption for this choice. Moreover, we show an important asymmetry in the role of corruption, in that the effect on extremism exists only within the opposition group. When the elite has greater ability to use corruption to obtain a better bargaining outcome from the opposition group leader (political corruption), then the equilibrium selection of group leader is more likely to be extreme. On the other hand, the perception of an existing rent extraction by the elite in power may determine the opposite effect within the majority group. We provide strong evidence for these novel predictions using the random audits data in Brazil as exogenous corruption signals, verifying that only within the opposition (to state-level incumbents) the signals determined an extremism drift in voting. Finally, we extend the analysis to extremism and conflict risk in divided countries.
    Keywords: agency; Bargaining; Corruption; delegation; extremism
    JEL: D72 D73
    Date: 2020–04
  6. By: Katarzyna Sałach (Faculty of Economic Sciences, University of Warsaw); Michał Brzeziński (Faculty of Economic Sciences, University of Warsaw)
    Abstract: We use newly collected original panel data on the super-wealthy individuals in Poland (observed over 2002-2018) to study the impact of the rich’s political connections on their wealth level, mobility among the rich and the risk of dropping off the rich list. The multimillionaires are classified as politically connected if we find reliable news stories linking their wealth to political contacts or questionable licenses, or if a person was formerly an informant of communist Security Service or member of the communist party, or when the origins of wealth are connected to the privatization process. We find that political connections are not associated with the wealth level of Polish multimillionaires, but that they are linked to the 20-30% lower probability of upward mobility in the ranking of the rich. Moreover, being a former member of the communist party or secret police informant increases the risk of dropping off the Polish rich list by 79%. Taken together, our results show that, contrary to some other post-socialist countries such as Russia or Ukraine, there is little evidence that the Polish economy suffers from crony capitalism.
    Keywords: the super-rich, billionaires, oligarchs, wealth inequality, top wealth, political connections, crony capitalism, Poland
    JEL: D31 D63 P36
    Date: 2020
  7. By: Paola Giuliano; Marco Tabellini
    Abstract: We test the relationship between historical immigration to the United States and political ideology today. We hypothesize that European immigrants brought with them their preferences for the welfare state, and that this had a long-lasting effect on the political ideology of US born individuals. Our analysis proceeds in three steps. First, we document that the historical presence of European immigrants is associated with a more liberal political ideology and with stronger preferences for redistribution among US born individuals today. Next, we show that this correlation is not driven by the characteristics of the counties where immigrants settled or other specific, socioeconomic immigrants’ traits. Finally, we conjecture and provide evidence that immigrants brought with them their preferences for the welfare state from their countries of origin. Consistent with the hypothesis that immigration left its footprint on American ideology via cultural transmission from immigrants to natives, we show that our results are stronger when inter-group contact between natives and immigrants, measured with either intermarriage or residential integration, was higher. Our findings also indicate that immigrants influenced American political ideology during one of the largest episodes of redistribution in US history — the New Deal – and that such effects persisted after the initial shock.
    JEL: D64 D72 H2 J15 N32 Z1
    Date: 2020–05
  8. By: Carozzi, Felipe; Cipullo, Davide; Repetto, Luca
    Abstract: This paper studies how political fragmentation affects government stability. We show that each additional party with representation in Parliament increases the probability that the incumbent government is unseated by 4 percentage points. Governments with more resources at their disposal for bargaining are less likely to be replaced. When they are, new government leaders are younger and better educated, suggesting instability may induce positive selection. We interpret our results in light of a bargaining model of coalition formation featuring government instability. Our findings indicate that the rising fragmentation in parliaments worldwide may have a substantial impact on stability and political selection.
    Keywords: Alignment effect; Bargaining; fragmentation; Government stability; No-confidence votes
    JEL: H1 H7 R50
    Date: 2020–04
  9. By: Agranov, Marina; Eilat, Ran; Sonin, Konstantin
    Abstract: We analyze a simple model of political competition, in which the uninformed median voter chooses whether to follow or ignore the advice of the informed elites. In equilibrium, information transmission is possible only if voters trust the elites' endorsement of potentially biased candidates. When inequality is high, the elites' informational advantage is minimized by the voters' distrust. When inequality reaches a certain threshold, the trust, and thus the information transmission, breaks down completely. Finally, the size of the elite forming in equilibrium depends on the amount of trust they are able to maintain.
    Keywords: cheap talk; inequality; information club; political economy; Trust
    JEL: D72 D83
    Date: 2020–04
  10. By: Pedro Bordalo; Marco Tabellini; David Y. Yang
    Abstract: We examine US voters’ beliefs about views held by Republicans and Democrats. While individuals exaggerate partisan differences on a range of socioeconomic and political issues, we document that belief distortions are larger on issues that individuals consider more important. We organize these facts using a model of stereotypes where distortions are stronger for issues that are more salient to voters. In line with the model, belief distortions are predictable from the differences across parties, in particular the relative prevalence of extreme attitudes. To assess the impact of issue salience, we show that the end of the Cold War in 1991, which shifted US voters’ attention away from external threats and towards domestic issues, led to an increase in perceived polarization in the latter, and more so for issues with more stereotypical partisan differences. The reverse pattern occurred after the terrorist attacks in 2001, when attention swung back towards external threats. The distortions we identify are quantitatively significant, and could have important consequences for political engagement as such distortions strongly predict voting turnout.
    JEL: D03 D8 D91
    Date: 2020–05
  11. By: Piguillem, Facundo; Riboni, Alessandro
    Abstract: Most fiscal rules can be overridden by consensus. We show that this does not make them ineffectual. Since fiscal rules determine the outside option in case of disagreement, the opposition uses them as ``bargaining chips" to obtain spending concessions. We show that under some conditions this political bargain mitigates the debt accumulation problem. We analyze various rules and find that when political polarization is high, harsh fiscal rules (e.g., government shutdown) maximize the opposition's bargaining power and leads to lower debt accumulation. When polarization is low, less strict fiscal limits (e.g, balanced-budget rule) are preferable. Moreover, we find that the optimal fiscal rules could arise in equilibrium by negotiation. Finally, by insuring against power fluctuations, negotiable rules yield higher welfare than strict ones.
    Keywords: fiscal rules; Government Debt; Government shutdown=; legislative bargaining; Political Polarization
    JEL: D72 H2 H6
    Date: 2020–04
  12. By: ONO Yoshikuni; MIWA Hirofumi
    Abstract: We evaluate an important question in the growing literature on women's substantive representation – whether gender differences in candidate issue engagement are robust to institutional environments that encourage policy convergence and "median-voter" chasing. While a growing body of evidence from American- and comparative politics reveals that gender does play a role in voters' evaluations of candidates, long-standing spatial theories and recent empirical work suggest that such candidate differences should disappear in the face of strategic incentives inherent to single-member district races – thereby limiting the potential for a descriptive-substantive link in women's representation. We address this question by leveraging the case of Japan, which allows us to analyze gender differences both before and after a major electoral reform that effected well documented changes in the nature of campaigning. Owing to the consistent and widespread use of candidate manifestos in Japanese elections, the case also enables us to more comprehensively and reliably measure candidate issue engagement than has typically been done in the representation literature. Using recently pioneered methodologies in probabilistic topic modeling on an analysis of over 20 years of general election manifestos, we find significant differences in the issues that male and female candidates use to present themselves to constituents regardless of party affiliation and other attributes. Moreover, we find that these differences remain salient even after the wholesale change from a multi-member district to a single-member district electoral system.
    Date: 2020–04
  13. By: Stephen B. Billings; Eric Chyn; Kareem Haggag
    Abstract: How do early-life experiences shape political identity? In this paper, we study how a shock to the social lives of youth affected their party affiliation in adulthood. Specifically, we examine the end of race-based busing in Charlotte-Mecklenburg schools (CMS), an event that led to large changes in school racial composition. Using linked administrative data, we compare party affiliation for students who had lived on opposite sides of newly drawn school boundaries. We find that a 10-percentage point increase in the share of minorities in a student's assigned school decreased their likelihood of registering as a Republican by 8.8 percent. Consistent with the contact hypothesis, this impact is entirely driven by white students (a 12 percent decrease). This effect size is roughly 16 percent of the correlation between parents and their children's party affiliations. Finally, consistent with this change reflecting underlying partisan identity, we find no significant effect on voter registration likelihood. Together these results suggest that schools in childhood play an important role in shaping partisanship.
    JEL: D72 I20 J15
    Date: 2020–06
  14. By: Elise S. Brezis (Bar-Ilan University)
    Abstract: The views of Keynes on Trade policy are clear: Protectionism as well as hoarding a surplus in the balance of payment are wrong. This paper analyzes the optimality of protectionist policies and having a surplus in the context of the international political system. I show that in the situation of a hegemonic country, all classes – the working class as well as the elite – opt for free trade. But, in a balance of power context, wherein no single actor on the international scene possesses hegemonic status, the working class will choose protectionism, having a surplus, asking for harsh reparations, while the transnational elite and Keynes will not.
    Keywords: Balance of Power, Carthaginian Peace, Hegemony, Reparations, National Sovereignty, Trade Policy
    JEL: E12 F30
    Date: 2020–02
  15. By: Bose, Neha (University of Warwick)
    Abstract: Immigration and attitudes towards immigration have been key features in economic development and political debate for decades. It can be hard to disentangle true beliefs about immigrants even where we have seemingly strong evidence such as the voting records of politicians. This paper builds an “immigration corpus” consisting of 24,351 U.S. congressional speeches relevant to immigration issues between 1990-2015. The corpus is used to form two distinct measures of attitude towards immigrants - one based on sentiment (or valence) and one based on the concreteness of language. The lexical measures, particularly sentiment, show systematic variation over time and across states in a manner consistent with the history and experiences of immigrants in the USA. The paper also computes a speaker specific measure of sentiment towards immigrants which is found to be a significant positive predictor of voting behaviour with respect to immigration related bills. Applying a Latent Dirichlet Allocation (LDA) topic odelling algorithm provides further insight into how different topics (such as border security or national security) have risen and fallen in importance over time in the face of key events such as 9/11.
    Date: 2020

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