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on Positive Political Economics |
| By: | Egorov, Georgy; Sonin, Konstantin |
| Abstract: | We survey recent theoretical and empirical literature on political economy of non-democracies. Dictators face many challenges to their rule: internal, such as palace coups or breakdown of their support coalition, or external, such as mass protests or revolutions. We analyze strategic decisions made by dictators --- hiring political loyalists to positions that require competence, restricting media freedom at the cost of sacrificing bureaucratic efficiency, running a propaganda campaign, organizing electoral fraud, purging associates and opponents, and repressing citizens --- as driven by the desire to maximize the regime's chances of staying in power. We argue that the key to understanding the functioning and ultimately the fate of a nondemocratic regime is the information flows within the regime, and the institutions that govern these information flows. |
| Keywords: | bureaucracy; Censorship; coup d'etat; Dictatorship; electoral fraud; media freedom; nondemocratic politics; Propaganda; repressions; Revolutions |
| JEL: | C73 D72 D74 D82 D83 P16 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15344&r= |
| By: | Davide Cipullo; André Reslow |
| Abstract: | This paper documents the existence of Political Forecast Cycles. In a theoretical model of political selection, we show that governments release overly optimistic GDP growth forecasts ahead of elections to increase the reelection probability. The bias arises from lack of commitment if voters are rational and from manipulation of voters’ beliefs if they do not expect the incumbent to be biased. Using high-frequency forecaster-level data from the United States, the United Kingdom, and Sweden, we document that governments overestimate short-term GDP growth by 10 to 13 percent during campaign periods. |
| Keywords: | electoral cycles, political selection, voting, macroeconomic forecasting |
| JEL: | D72 D82 E37 H68 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9088&r= |
| By: | Rohner, Dominic; Saia, Alessandro |
| Abstract: | Does democracy hold its promise to curb domestic political violence? While the matter has been heatedly debated for decades, not much reliable causal evidence exists so far. To study this question we focus on UK's Victorian Age of Reform, and in particular the Representation of the People Act of 1867 -- which is widely regarded as a critical juncture in the history of democratization. We have constructed a novel dataset on conflict events and economic performance around the 1868 Elections (the first elections where newly enfranchised citizens could vote) and exploit arguably exogenous variation in enfranchisement intensity across UK cities. We find a strong and robust peace-promoting effect of franchise extension and identify as major channel the beneficial impact of representation on local economic growth. |
| Keywords: | conflict; democracy; Development; Elections; Enfranchisement; Franchise Extension; growth; riots; Social Violence; voting |
| JEL: | C33 D72 D74 N43 O17 |
| Date: | 2020–09 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15280&r= |
| By: | Bierbrauer, Felix; Polborn, Mattias |
| Abstract: | Gerrymandering undermines representative democracy by creating many uncompetitive legislative districts, and generating the very real possibility that a party that wins a clear majority of the popular vote does not win a majority of districts. We present a new approach to the determination of electoral districts, taking a design perspective. Specifically, we develop a redistricting game between two parties who both seek an advantage in upcoming elections, and show that we can achieve two desirable properties: First, the overall election outcome corresponds to the popular vote. Second, most districts are competitive. |
| Keywords: | Gerrymandering; legislative elections; redistricting |
| JEL: | C72 D72 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15401&r= |
| By: | Benoit S Y Crutzen (Erasmus School of Economics); Hideo Konishi (Boston College); Nicolas Sahuguet (HEC Montreal) |
| Abstract: | Under closed-list proportional representation, a party's electoral list determines the order in which legislative seats are allocated to candidates. When candidates differ in their ability, parties face a trade-off between competence and incentives. Ranking candidates in decreasing order of competence ensures that elected politicians are most competent. Yet, party lists create incentives for candidates that may push parties not to rank candidates in decreasing competence order. We examine this trade-off in a game-theoretical model in which parties rank their candidate on a list, candidates choose their campaign effort, and the election is a team contest for multiple prizes. We show that the trade-off between competence and incentives depends on candidatesÂ’' objective and the electoral environment. In particular, parties rank candidates in decreasing order of competence if candidates value enough post-electoral high offices or media coverage focuses on candidates at the top of the list. |
| JEL: | D72 C72 |
| Date: | 2021–05–10 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20210039&r= |
| By: | Lee, Neil; Lipp, Cornelius; Rodríguez-Pose, Andrés |
| Abstract: | In 2000 Robert Putnam forecast that United States (US) democracy was at risk from the twin challenges of declining civic engagement and rising interpersonal inequality. Sixteen years later, his predictions were vindicated by the election of Donald Trump as president of the US. This paper analyses the extent to which the election of Donald Trump was related to levels of social capital and interpersonal inequalities and posits a third alternative: that the rise in vote for Trump in 2016 was the result of long-term economic and population decline in areas with strong social capital. This hypothesis is confirmed by the econometric analysis conducted for counties across the US. Long-term declines in employment and population â?? rather than in earnings, salaries, or wages â?? in places with relatively strong social capital propelled Donald Trump to the presidency. By contrast, low social capital and high interpersonal inequality were not connected to a surge in support for Trump. These results are robust to the introduction of control variables and different inequality measures. The analysis also shows that the discontent at the base of the Trump margin is not just a consequence of the 2008 crisis but had been brewing for a long time. Places in the US that remained cohesive but witnessed an enduring decline are no longer bowling alone, they are golfing with Trump. |
| Keywords: | Counties; Donald Trump; economic and demographic decline; inequality; populism; social capital; US |
| JEL: | D31 D72 O15 R11 |
| Date: | 2020–09 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15259&r= |
| By: | Davide Cipullo |
| Abstract: | This paper investigates the impact of voter support on the representation of women in the political profession. The empirical analysis exploits two-stage elections in the United States and Italy to hold the selection of candidates constant. In two-stage elections, candidates are admitted to the second round of voting based on the outcome of the first round. I find that among candidates who marginally qualify for the final round, women are 20 percent less likely than men to be elected to the US House of Representatives and 40 percent less likely to be elected mayor in Italian municipalities. Using a difference-in-discontinuities design, I then show that the gender gap in the probability of being elected has long-lasting effects on career trajectories. Women are substantially less likely than men to win future elections and to climb the political hierarchy. My findings suggest that one of the reasons that few women reach the top in politics is that female candidates face hurdles at the beginning of their careers. |
| Keywords: | gender gaps, self-selection, political careers, voting |
| JEL: | C24 D02 D72 J16 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9075&r= |
| By: | Benoit S Y Crutzen (Erasmus Universiteit Rotterdam); Sabine Flamand (Universitat Rovira I Virgili) |
| Abstract: | We develop a formal model of the internal game between the leader and the factions of a party, to study the effect of party leadership on electoral success. Factions are of interest or of principle. The probability of winning an election is increasing in the leader's charisma, but also in party unity and coherence and in the factions' total contributions to party work and electoral efforts. To push factions to contribute, the leader offers both types of factions their favorite rewards in exchange for their contributions. We show that party unity and factions' total contributions are not necessarily increasing in the leader's charisma and ideological proximity to factions. Further, we show that factions of interest constraint the party's electoral strategy less than factions of principle. In particular, factions of interest always contribute more than factions of principle, are less of an obstacle towards achieving party unity, and offer the party more freedom in its choice of the ideological location and charisma of the party leader. |
| JEL: | D72 C72 |
| Date: | 2021–05–11 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20210041&r= |
| By: | Guerrero, Omar; Matter, Ulrich |
| Abstract: | Building on the concept of reciprocity in directed weighted networks, we propose a framework to study legislative vote trading. We first discuss the conditions to quantify vote trading empirically. We then illustrate how a simple empirical framework—complementary to existing approaches—can facilitate the discovery and measurement of vote trading in roll-call data. The application of the suggested procedure preserves the micro-structure of trades between individual legislators, shedding light on, so far, unstudied aspects of vote trading. Validation is provided via Monte Carlo simulation of the legislative process (with and without vote trading). Applications to two major studies in the field provide richer, yet consistent evidence on vote trading in US politics. |
| Keywords: | Vote trading, roll-call voting, networks, reciprocity, US Congress |
| JEL: | D72 D85 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:usg:econwp:2021:06&r= |
| By: | Alesina, Alberto F; Tabellini, Marco |
| Abstract: | We review the growing literature on the political effects of immigration. After a brief summary of the economics of immigration, we turn to the main focus of the paper: how immigrants influence electoral outcomes in receiving countries, and why. We start from the "standard" view that immigration triggers political backlash and raises support for nativist, anti-immigrant political parties. We present evidence from a variety of studies that the causes of natives' political discontent are unlikely to have (solely) economic roots, but are instead more tightly linked to cultural and social concerns. Next, we discuss works that paint a more nuanced picture of the effects of immigration, which, in some cases, can move natives' preferences in a more liberal direction. We also consider the factors that can explain a seemingly puzzling empirical regularity: the anti-immigration rhetoric has become a banner of right wing parties. We conclude by outlining what, to us, are promising avenues for future research. |
| JEL: | D72 J11 J15 J61 Z1 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15486&r= |
| By: | Ying Chen; Jan Zapal |
| Abstract: | To enact a policy, a leader needs votes from committee members with heterogeneous opposition intensities. She sequentially offers transfers in exchange for votes. The transfers are either promises paid only if the policy passes or paid up front. With transfer promises, a vote costs nearly zero. With up-front payments, a vote can cost significantly more than zero, but the leader is better off with up-front payments. The leader does not necessarily buy the votes of those least opposed. The opposition structure most challenging to the leader involves either a homogeneous committee or a committee with two homogenous groups. Our results provide an explanation for several empirical regularities: lobbying of strongly opposed legislators, the Tullock Paradox and expansion of the whip system in the U.S. House concurrent with ideological homogenization of parties. We also discuss several extensions including private histories and simultaneous offers. |
| Keywords: | vote buying; legislative bargaining; coalition building; endogenous sequencing; transfer promise; up-front payment; contracting with externalities; |
| JEL: | C78 D72 P16 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp692&r= |
| By: | Alesina, Alberto (Harvard University); Tabellini, Marco (Harvard Business School) |
| Abstract: | We review the growing literature on the political effects of immigration. After a brief summary of the economics of immigration, we turn to the main focus of the paper: how immigrants influence electoral outcomes in receiving countries, and why. We start from the "standard" view that immigration triggers political backlash and raises support for nativist, anti-immigrant political parties. We present evidence from a variety of studies that the causes of natives' political discontent are unlikely to have (solely) economic roots, but are instead more tightly linked to cultural and social concerns. Next, we discuss works that paint a more nuanced picture of the effects of immigration, which, in some cases, can move natives' preferences in a more liberal direction. We also consider the factors that can explain a seemingly puzzling empirical regularity: the anti-immigration rhetoric has become a banner of right wing parties. We conclude by outlining what, to us, are promising avenues for future research. |
| Keywords: | immigration, diversity, culture, politics |
| JEL: | D72 J11 J15 J61 Z1 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14354&r= |
| By: | Garcia-Uribe, Sandra; Mueller, Hannes Felix; Sanz, Carlos |
| Abstract: | This article exploits two newspaper archives to track economic policy uncertainty in Spain in 1905-1945, a period of extreme political polarization. We find that the outbreak of the civil war in 1936 was anticipated by a striking upward level shift of uncertainty in both newspapers. We study the dynamics behind this shift and provide evidence of a strong empirical link between increasing uncertainty and the rise of divisive political issues at the time: socio-economic conflict, regional separatism, power of the military, and role of the church. This holds even when we exploit variation in content at the newspaper level. |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15479&r= |
| By: | Bonfatti, Roberto; Gu, Yuan; Poelhekke, Steven |
| Abstract: | Africa's interior-to-coast roads are well placed to export natural resources, but not to support regional trade. Are they the optimal response to geography and comparative advantage, or the result of suboptimal political distortions? We investigate the political determinants of road paving in West Africa in 1965-2014. Controlling for geography and comparative advantage, we find that autocracies focused more than democracies on connecting metal and mineral deposits to ports, resulting in more interior-to-coast networks. This deposit-to-port bias was only present for deposits located on the elite's ethnic homeland, suggesting that Africa's interior-to-coast roads were the result of ethnic favoritism by autocracies. |
| Keywords: | democracy; Development; infrastructure; Natural resources; political economy |
| JEL: | D72 H54 O18 P16 P26 Q32 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15354&r= |
| By: | Eugen Dimant |
| Abstract: | Political polarization has ruptured the fabric of U.S. society. I quantify this phenomenon through the use of 5 pre-registered studies, comprising 15 behavioral experiments and a diverse set of over 8,600 participants. The focus of this paper is to examine various behavioral-, belief-, and norm-based layers of (non-)strategic decision-making that are plausibly affected by existing polarization in the context of Donald J. Trump. I find strong heterogeneous effects: ingroup-love occurs in the perceptional domain (how close one feels towards others), whereas outgroup-hate occurs in the behavioral domain (how one helps/harms/cooperates with others). The rich setting also allows me to examine the mechanisms of observed intergroup conflict, which can be attributed to one’s grim expectations regarding cooperativeness of the opposing faction, rather than one’s actual unwillingness to cooperate. In a final step, I test whether popular behavioral interventions (defaults and norm-nudging) can eradicate the detrimental impact of polarization in the (non-) strategic contexts studied here. The interventions are ineffective in closing the polarization gap, suggesting that structural – on top of behavioral - changes are needed to mend existing fractions and heal the society. |
| Keywords: | identity, norms, nudging, polarization, social preferences |
| JEL: | C90 D01 D90 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9073&r= |
| By: | Amory Gethin (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, WIL - World Inequality Lab) |
| Abstract: | This paper exploits political attitudes surveys conducted between 1953 and 2017 to document long-run changes in the structure of political cleavages in Japan. I analyze the transformation of Japan's one-party dominant system from the hegemony of the Liberal Democratic Party (LDP) to the disintegration of conservative forces into multiple splinter parties and the rise of a new centrist coalition. Throughout Japan's contemporary history, persisting divides based upon foreign policy and remilitarization have remained a key axis of democratic conflicts. These divides have coincided with lower-educated voters showing greater support for the LDP and other conservative parties, which have generally advocated expansion of military spending and overseas interventions. The strength of the LDP in postwar decades also relied on a unique coalition of poorer rural areas and business elites, while socialist and communist parties found greater support among urban unionized wage earners. Urbanization, declining rural-urban inequalities, the expansion of education, and the subsequent fragmentation of the party system have put an end to this equilibrium and have been associated with a remarkable "depolarization" of Japan's political space. I also analyze the long-run transformation of generational divides in relation to changing attitudes to war memory and political parties. |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-03215888&r= |
| By: | Lydia Assouad (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, WIL - World Inequality Lab); Amory Gethin (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, WIL - World Inequality Lab); Thomas Piketty (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, WIL - World Inequality Lab); Juliet-Nil Uraz (EUI - European University Institute) |
| Abstract: | This paper draws on political attitudes surveys to document the evolution of political cleavages in light of inequality dynamics in Algeria (2002-2018), Iraq (2005-2018), and Turkey (1991-2018). We investigate how social divides and ethno-religious conflicts shape voting behaviors in these three countries through their interaction with the voting system and the structure of inequalities. Our findings suggest that identity-based voting remains highly interconnected with social disparities and does not offer extensive explanatory power on its own, except in the extreme case of the Iraqi sectarian political system. Socioeconomic factors play a differentiated role depending on the historical and institutional context and have increasingly been at the heart of popular mobilizations outside of the electoral arena. |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wilwps:halshs-03215898&r= |