nep-pol New Economics Papers
on Positive Political Economics
Issue of 2021‒10‒11
five papers chosen by
Eugene Beaulieu
University of Calgary

  1. Exogenous Shocks and Electoral Outcomes: Re-examining the Rational Voter Hypothesis By Kaustav Das; Atisha Ghosh; Pushkar Maitra
  2. It Takes Money to Make MPs: Evidence from 150 Years of British Campaign Spending By Julia Cage; Edgard Dewitte
  3. Tradeoffs in Hierarchical Voting Systems By Lucas B\"ottcher; Georgia Kernell
  4. Ethnofederalism and Ethnic Voting By Richard Bluhm; Roland Hodler; Paul Schaudt
  5. The Forest Behind the Tree: Heterogeneity in How US Governor's Party Affects Black Workers By Tchuente, Guy; Kakeu, Johnson; Francois, John Nana

  1. By: Kaustav Das (University of Leicester); Atisha Ghosh (University of Warwick); Pushkar Maitra (Monash University)
    Abstract: Voters are assumed to be irrational if they respond to shocks beyond the control of politicians. What if the politicians can respond to such shocks? Using a theoretical model, where shocks can either be responsive (allowing politicians to respond) or nonresponsive, we show that voters are irrational if non-responsive shocks affect electoral outcomes. We test this using data from the 1991 Indian parliamentary elections. In the middle of the election, the leader of the opposition was assassinated. We find that this affected the electoral outcomes indicating irrationality on the part of Indian voters.
    Keywords: Voter rationality, Responsive shock, Non-Responsive Shock, Election Outcomes.
    JEL: P16 D72 H12
    Date: 2021–10
  2. By: Julia Cage (Département d'économie); Edgard Dewitte (Département d'économie)
    Abstract: We study electoral campaigns over the long run, through the lens of their spending. In particular, we ask whether changing media technologies and electoral environments impacted patterns of spending and their correlation with electoral results. To do so, we build a novel exhaustive dataset on general elections in the United Kingdom from 1857 to 2017, which includes information on campaign spending (itemized by expense categories), electoral outcomes and socio-demographic characteristics for 69, 042 election-constituency candidates. We start by providing new insights on the history of British political campaigns, in particular the growing importance of advertising material, including via digital means, to the detriment of paid staff and electoral meetings. We then show that there is a strong positive correlation between expenditures and votes, and that overall the magnitude of this relationship has strongly increased since the 1880s, with a peak in the last quarter of the 20th century. We link these transformations to changes in the conduct of campaigns, and to the introduction of new information technologies. We show in particular that the expansion of local radio and broadband Internet increased the sensitivity of the electoral results to differences in campaign spending. These results encourage greater contextualization in the drafting of campaign finance regulations.
    Keywords: Elections; Campaign finance; Electoral expenditures; Information technologies
    JEL: D72 P48 H7
    Date: 2021–09
  3. By: Lucas B\"ottcher; Georgia Kernell
    Abstract: Condorcet's jury theorem states that the correct outcome is reached in direct majority voting systems with sufficiently large electorates as long as each voter's independent probability of voting for that outcome is greater than 0.5. Yet, in situations where direct voting systems are infeasible, such as due to high implementation and infrastructure costs, hierarchical voting systems provide a reasonable alternative. We study differences in outcome precision between hierarchical and direct voting systems for varying group sizes, abstention rates, and voter competencies. Using asymptotic expansions of the derivative of the reliability function (or Banzhaf number), we first prove that indirect systems differ most from their direct counterparts when group size and number are equal to each other, and therefore to $\sqrt{N_{\rm d}}$, where $N_{\rm d}$ is the total number of voters in the direct system. In multitier systems, we prove that this difference is maximized when group size equals $\sqrt[n]{N_{\rm d}}$, where $n$ is the number of hierarchical levels. Second, we show that while direct majority rule always outperforms hierarchical voting for homogeneous electorates that vote with certainty, as group numbers and size increase, hierarchical majority voting gains in its ability to represent all eligible voters. Furthermore, when voter abstention and competency are correlated within groups, hierarchical systems often outperform direct voting, which we show by using a generating function approach that is able to analytically characterize heterogeneous voting systems.
    Date: 2021–10
  4. By: Richard Bluhm; Roland Hodler; Paul Schaudt
    Abstract: We investigate how changes in the administrative-territorial structure affect ethnic voting. We present an event study design that exploits the 2010 constitutional reform in Kenya, which substantially increased the number of primary administrative regions. We find (i) strong evidence for a reduction in ethnic voting when administrative regions become less ethnically diverse and (ii) weak evidence for such a reduction when ethnic groups become less fragmented across regions. These results suggest that ‘ethnofederal’ reforms (leading to administrative borders that more closely follow ethnic boundaries) can mitigate ethnic politics in diverse countries.
    Keywords: ethnofederalism, decentralization, territorial structure, ethnic divisions, ethnic voting, ethnic politics, Kenya
    JEL: D02 D72 H77 J15 O55
    Date: 2021
  5. By: Tchuente, Guy; Kakeu, Johnson; Francois, John Nana
    Abstract: Income inequality is a distributional phenomenon. This paper examines the impact of U.S governor's party allegiance (Republican vs Democrat) on ethnic wage gap. A descriptive analysis of the distribution of yearly earnings of Whites and Blacks reveals a divergence in their respective shapes over time suggesting that aggregate analysis may mask important heterogeneous effects. This motivates a granular estimation of the comparative causal effect of governors' party affiliation on labor market outcomes. We use a regression discontinuity design (RDD) based on marginal electoral victories and samples of quantiles groups by wage and hours worked. Overall, the distributional causal estimations show that the vast majority of subgroups of black workers earnings are not affected by democrat governors' policies, suggesting the possible existence of structural factors in the labor markets that contribute to create and keep a wage trap and/or hour worked trap for most of the subgroups of black workers. Democrat governors increase the number of hours worked of black workers at the highest quartiles of earnings. A bivariate quantiles groups analysis shows that democrats decrease the total hours worked for black workers who have the largest number of hours worked and earn the least. Black workers earning more and working fewer hours than half of the sample see their number of hours worked increase under a democrat governor.
    Keywords: U.S. State Policy,Black Workers,US Labor Market,RDD,Governors' Effects Heterogeneity,Bivariate Quantile Causality
    JEL: D72 J15 J22 J31 R23
    Date: 2021

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