nep-pol New Economics Papers
on Positive Political Economics
Issue of 2022‒11‒07
fourteen papers chosen by
Eugene Beaulieu
University of Calgary

  1. The Effect of Social Media on Elections: Evidence from the United States By Thomas Fujiwara; Karsten Müller; Carlo Schwarz
  2. Coordination and Incumbency Advantage in Multi-Party Systems - Evidence from French Elections By Kevin Dano; Francesco Ferlenga; Vincenzo Galasso; Caroline Le Pennec; Vincent Pons
  3. National Polls, Local Preferences and Voters’ Behaviour : Evidence from the UK General Elections By Alabrese, Eleanora
  4. The Political Consequences of Green Policies: Evidence from Italy By Colantone, Italo; Di Lonardo, Livio; Margalit, Yotan; Percoco, Marco
  5. Mobile internet and the rise of political tribalism in Europe By Marco Manacorda; Guido Tabellini; Andrea Tesei
  6. Terrorism, perpetrators and polarization : Evidence from natural experiments By Bove, Vincenzo; Di Leo, Riccardo; Efthyvoulou, Georgios; Pickard, Harry
  7. Financing UK democracy : A stocktake of 20 years of political donations By Draca, Mirko; Green, Colin; Homroy, Swarnodeep
  8. The Bureaucracy Trap By Ascensión Andina-Díaz; Francesco Feri; Miguel A. Meléndez-Jiménez
  9. Obvious manipulations of tops-only voting rules By R. Pablo Arribillaga; Agustin G. Bonifacio
  10. Why are There More Women in the Upper House? By KASUYA Yuko; MIWA Hirofumi; ONO Yoshikuni
  11. Personalization of Web Search During the 2020 US Elections By Ulrich Matter; Roland Hodler; Johannes Ladwig
  12. Political adverse selection By Leonardo Bursztyn; Jonathan Kolstad; Aakaash Rao; Pietro Tebaldi; Noam Yuchtman
  13. Politicians, bankers and the Great Depression: The Spanish banking crisis of 1931 By Jorge-Sotelo, Enrique
  14. Democracy and Lifelong Learning in Africa By Chimere O. Iheonu; Simplice A. Asongu

  1. By: Thomas Fujiwara (Princeton University and NBER); Karsten Müller (National University of Singapore); Carlo Schwarz (Università Bocconi)
    Abstract: We study how social media affects election outcomes in the United States. We use variation in the number of Twitter users across counties induced by early adopters at the 2007 South by Southwest (SXSW) festival, a key event in Twitter’s rise to popularity. We show that this variation is unrelated to observable county characteristics and electoral outcomes before the launch of Twitter. Our results indicate that Twitter lowered the Republican vote share in the 2016 and 2020 presidential elections, but had limited effects on Congressional elections and previous presidential elections. Evidence from survey data, primary elections, and a text analysis of millions of tweets suggests that Twitter’s relatively liberal content may have persuaded voters with moderate views to vote against Donald Trump.
    Keywords: voting behavior, elections
    JEL: D72
    Date: 2022–09
  2. By: Kevin Dano; Francesco Ferlenga; Vincenzo Galasso; Caroline Le Pennec; Vincent Pons
    Abstract: In theory, free and fair elections can improve the selection of politicians and incentivize them to exert effort. In practice, incumbency advantage and coordination issues may lead to the (re)election of bad politicians. We ask whether these two forces compound each other. Using a regression discontinuity design in French two-round local and parliamentary elections, we find that winning an election increases candidates' chances to win the next election by 25.1 percentage points. Close winners are more likely to run again and more likely to win, conditional on running, than close losers. Incumbents personalize their campaign communication more and face fewer ideologically close competitors, indicating that parties coordinate more effectively on the winning side than on the losing side. A complementary RDD reveals that marginally qualifying for the runoff also enables candidates to rally new voters, but does not affect the number of competitors on their side. We conclude that party coordination and voters rallying candidates who won or gained visibility in an election both contribute to their success in future races, even absent any actual difference in quality with candidates on the losing side.
    JEL: D72 K16
    Date: 2022–10
  3. By: Alabrese, Eleanora (University of Warwick)
    Abstract: A central challenge for social scientists consists in explaining why people vote and what are the consequences of their behaviour. Exploiting variation in national opinion polls across UK general elections, and in the degree of safeness of British constituencies over time, I provide evidence of a significant impact of pre-election polls on electoral outcomes and shed light on a novel mechanism. I find that opinion polls affect voters’ behaviour via their interaction with the recent electoral history of a constituency : first, turnout decreases when the polls predict non-competitive elections, and this effect is stronger in safe seats. Second, the composition of local vote shares and parties’ performance is also impacted by anticipated election closeness and the effects vary heterogeneously depending on whether polls predictions are aligned with the past electoral outcomes of a constituency. Finally, the causal impact on voters’ participation is confirmed with consistent individual-level evidence.
    Keywords: Opinion Polls ; Closeness ; Voters Behaviour ; First-past-the-post ; UK general elections JEL Codes: D72 ; P16
  4. By: Colantone, Italo; Di Lonardo, Livio; Margalit, Yotan; Percoco, Marco
    Abstract: For many governments, enacting green policies is a priority, but such policies often impose on citizens substantial and uneven costs. How does the introduction of green policies a˙ect voting? We study this question in the context of a major ban on polluting cars introduced in Milan, which was strongly opposed by the populist right party Lega. Using several inferential strategies, we show that owners of banned vehicles — who incurred a median loss of €3,750 — were significantly more likely to vote for Lega in the subsequent elections. Our analysis indicates that this electoral change did not stem from a broader shift against environmentalism, but rather from disaffection with the policy’s uneven pocketbook implications. In line with this pattern, recipients of compensation from the local government were not more likely to switch to Lega. The findings highlight the central importance of distributive consequences in shaping the political ramifications of green policies.
    Keywords: Environmental Economics and Policy
    Date: 2022–10–21
  5. By: Marco Manacorda; Guido Tabellini; Andrea Tesei
    Abstract: We study the political effects of the diffusion of mobile Internet between 2007 and 2017, using data on electoral outcomes and on mobile Internet signal across the 84,564 municipalities of 22 European countries. We find that access to mobile Internet increased voters' support for right-wing populist parties and for parties running on extreme socially conservative platforms, primarily in areas with greater economic deprivation. Using survey data, we also show that mobile Internet increased communitarian attitudes, such as nationalism and dislike of strangers and minorities. We conclude that mobile Internet benefitted right-wing populist parties because, in line with findings in social psychology, it fostered offline tribalism.
    Keywords: populism, communitarianism, Europe, mobile internet
    Date: 2022–10–14
  6. By: Bove, Vincenzo (University of Warwick); Di Leo, Riccardo (Carlos III-Juan March Institute,); Efthyvoulou, Georgios (University of Sheffield); Pickard, Harry (Newcastle University Business School)
    Abstract: We analyze whether affective polarization – the extent to which citizens feel sympathy towards partisan in-groups and antagonism towards partisan out-groups – can be aggravated by terrorism violence. Terrorist attacks intensify pre-existing ideological worldviews and partisan leanings and bring divisive political issues to the fore. Yet, they can also lead individuals from the entire political spectrum to come together and dissociate from the terrorists and their radical ideas. To identify causal effects, we exploit a series of natural experiments in Great Britain and leverage the timing of fatal far-right and Islamic terrorist attacks and the date of interview of respondents in the British Election Study. We find that Islamic attacks increase affective polarization whereas far-right attacks depolarize the electorate. We demonstrate that this discrepancy is largely driven by the salience of the attack – and the resulting threat perceptions – and the attitudes towards contentious and polarizing issues.
    Keywords: Islamic terrorism ; far-right terrorism ; polarization ; natural experiment
  7. By: Draca, Mirko (University of Warwick, Department of Economics & CAGE); Green, Colin (Norwegian University of Science and Technology, Department of Economics & IZA); Homroy, Swarnodeep (University of Groningen, Department of Economics, Econometrics and Finance)
    Abstract: Political donations in the UK have been subject to comprehensive disclosure since 2001. We study the data produced as part of this disclosure policy to evaluate the role of private and public political finance over time. Total political donations have grown by 250% since 2001, reaching over £100 million in real terms for the first time in 2019. This increase has been driven by donations from private individuals, who now account for approximately 60% of donations in election years compared to 40-50% up to the late 2010s. Furthermore, ‘superdonors’ (those contributing more than £100,000) have been a prominent driver of the rise, increasing their own share from approximately 36% in 2017 to 46% in 2019. We also show that private donations to Labour fell sharply in the final stages of Jeremy Corbyn’s leadership. Overall, these trends have benefited the Conservative Party, leading to an historic resource gap between the two main parties emerging circa 2019. We calculate that the ‘resource gap’ between parties now stands at approximately £27 million compared to an historic average of £8-10 million (even when taking account of publicly-funded ‘Short’ money provided to the Opposition).
    Keywords: Political Connections ; Political Donations JEL Codes: D72
    Date: 2022
  8. By: Ascensión Andina-Díaz (Departamento de Teoría e Historia Económica, Universidad de Málaga.); Francesco Feri (Department of Economics, Royal Holloway, University of London.); Miguel A. Meléndez-Jiménez (Departamento de Teoría e Historia Económica, Universidad de Málaga.)
    Abstract: In a recent paper, Andina-D´?az et al. (2021) show that in a context of dynamic elections, rigid institutions induce political parties to push policies as far as the political system allows, whereas more flexible institutions can foster moderate alternation. We build on this paper to study the incentive of an elected government to reduce bureaucratic inefficiencies and increase institutional flexibility. We show that high levels of bureaucratic inefficiencies are very likely to persist over time, leading to a bureaucracy trap. Moreover, we find that regardless of the initial levels of bureaucratic inefficiencies, traditional long-life parties may have no incentive to undertake such a reform. This result provides a new argument to explain why bureaucratic inefficiencies persist in some countries over time
    Keywords: MGradual policy implementation; political alternation; institutional reform; bureaucratic trap.
    JEL: D02 D72
    Date: 2022–10
  9. By: R. Pablo Arribillaga; Agustin G. Bonifacio
    Abstract: In a voting problem with a finite set of alternatives to choose from, we study the manipulation of tops-only rules. Since all non-dictatorial (onto) voting rules are manipulable when there are more than two alternatives and all preferences are allowed, we look for rules in which manipulations are not obvious. First, we show that a rule does not have obvious manipulations if and only if when an agent vetoes an alternative it can do so with any preference that does not have such alternative in the top. Second, we focus on two classes of tops-only rules: (i) (generalized) median voter schemes, and (ii) voting by committees. For each class, we identify which rules do not have obvious manipulations on the universal domain of preferences.
    Date: 2022–10
  10. By: KASUYA Yuko; MIWA Hirofumi; ONO Yoshikuni
    Abstract: In directly elected bicameral legislatures without a quota system, there is often a large disparity in the percentage of women's representation between the two chambers. Japan is no exception to this rule. The share of women members in the upper house (23.1%) is twice as high as that in the lower house (9.7%). Furthermore, the former has consistently outnumbered the latter for decades. The disparity between the two chambers may be the results of differences in electoral systems, but that cannot fully explain it. We explore the mechanisms behind this disparity through two survey experiments from the perspectives of both voters (demand side) and candidates (supply side). Our findings show that voters become more supportive of women candidates in upper house elections when they are informed that the upper house plays a subordinate role in decision-making. Moreover, women are found to be more willing to run for office when they are informed about the job security that accompanies an upper house position, whereas men are less willing to run when they are informed about the limited power of the upper house to appoint the prime minister. These results suggest that the institutional priming conditions people's attitudes toward women candidates and their willingness to run for office, resulting in a large disparity in the percentage of women representatives between the two chambers in the bicameral legislature.
    Date: 2022–09
  11. By: Ulrich Matter; Roland Hodler; Johannes Ladwig
    Abstract: Search engines play a central role in routing political information to citizens. The algorithmic personalization of search results by large search engines like Google implies that different users may be offered systematically different information. However, measuring the causal effect of user characteristics and behavior on search results in a politically relevant context is challenging. We set up a population of 150 synthetic internet users ("bots") who are randomly located across 25 US cities and are active for several months during the 2020 US Elections and their aftermath. These users differ in their browsing preferences and political ideology, and they build up realistic browsing and search histories. We run daily experiments in which all users enter the same election-related queries. Search results to these queries differ substantially across users. Google prioritizes previously visited websites and local news sites. Yet, it does not generally prioritize websites featuring the user's ideology.
    Date: 2022–09
  12. By: Leonardo Bursztyn; Jonathan Kolstad; Aakaash Rao; Pietro Tebaldi; Noam Yuchtman
    Abstract: We study how the politicization of policies designed to correct market failures can undermine their effectiveness. The Patient Protection and Affordable Care Act (ACA) was among the most politically divisive expansions of the US government. We examine whether partisanship distorted enrollment and market outcomes in the ACA insurance marketplaces. Controlling for observable characteristics and holding fixed plans and premiums available, Republicans enrolled less than Democrats and independents in ACA marketplace plans. Selection out of the ACA marketplaces was strongest among Republicans with lower expected healthcare costs, generating adverse selection. Computing enrollment and average cost with and without partisan differences, we find that this political adverse selection reduced enrollment by around three million people and raised average costs in the marketplaces, increasing the level of public spending necessary to provide subsidies to low-income enrollees by around $105 per enrollee per year. Lower enrollments and higher costs are concentrated in more Republican areas, potentially contributing to polarized views of the ACA.
    Date: 2022–07–12
  13. By: Jorge-Sotelo, Enrique
    Abstract: This paper contributes to the literature on moral hazard, lending of last resort and the political origins of banking crises. Drawing on newly accessed quantitative and qualitative archival sources the paper documents how a bank - Banco de Cataluña - formed a coalition with the Dictatorship of Primo de Rivera (1923-30) in order to depart from the framework of "constructive ambiguity" that characterized central bank lending of last resort in Spain. As a result, the bank developed a uniquely risky portfolio and incurred in insider lending to internationally exposed firms at the onset of the Great Depression. The fall of the Dictatorship and democratic transition, the collapse of international trade, and global deflation during 1929-31 made fragilities emerge causing the bank to fail.
    Keywords: moral hazard,lender of last resort,Great Depression
    JEL: N24 E58 G01
    Date: 2022
  14. By: Chimere O. Iheonu (University of Nigeria, Nsukka, Nigeria); Simplice A. Asongu (Yaoundé, Cameroon)
    Abstract: Education has been cited in both theoretical and empirical literature as a key driver of socioeconomic growth. African educational outcomes, however, continue to be subpar at all levels. This study examines the impact of democracy on lifelong learning in 52 African countries from 1990 to 2020, employing Fixed Effects regressions. Six democracy indicators, which include electoral, liberal, participatory, deliberative, egalitarian, and total democracy, derived from the principal component analysis (PCA), are employed in the study. The study also utilizes four education variables to capture lifelong learning in Africa and includes primary, secondary, and tertiary school enrolment, as well as a lifelong learning index derived from the PCA. The findings reveal that improving the quality of democracy in Africa can significantly enhance primary school enrolment. The study also finds that improving electoral, participatory, and egalitarian democracy significantly improves secondary school enrolment in the presence of endogeneity. Additionally, improving egalitarian democracy significantly spurs tertiary education. These findings show the importance of political institutions in enhancing educational attainment and lifelong learning in Africa.
    Keywords: Democracy, Lifelong Learning, Africa, Fixed Effects Model, Instrumental Variable
    Date: 2022–01

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