nep-pol New Economics Papers
on Positive Political Economics
Issue of 2022‒11‒14
thirteen papers chosen by
Eugene Beaulieu
University of Calgary

  1. Targeting hunger or votes? The political economy of humanitarian transfers in Malawi By Duchoslav, Jan; Kenamu, Edwin; Thunde, Jack
  2. Is Demonstrating against the Far Right Worth It? Evidence from French Presidential Elections By Lagios, Nicolas; Meon, Pierre-Guillaume; Tojerow, Ilan
  3. Political Leaders and Macroeconomic Expectations: Evidence from a Global Survey Experiment By Dorine Boumans; Klaus Gründler; Niklas Potrafke; Fabian Ruthardt
  4. Mobile Internet and the Rise of Political Tribalism in Europe By Marco Manacorda; Guido Tabellini; Andrea Tesei
  5. Electoral Turnovers By Benjamin Marx; Vincent Pons; Vincent Rollet
  6. On Political and Economic Determinants of Redistribution: Economic Gains, Ideological Gains, or Institutions? By Gustavo de Souza
  7. Do party ties increase transfer receipts in cooperative federalism? Evidence from Germany By Bury, Yannick; Feld, Lars P.; Köhler, Ekkehard A.
  8. The Political U: New Evidence on Democracy and Income By Campos, Nauro F.; Coricelli, Fabrizio; Frigerio, Marco
  9. Politics and income taxes: progress and progressivity By Berliant, Marcus; Boyer, Pierre
  10. 'Enlightened' West African dictatorship challenged by state capture ? Insights from Benin, Togo and Senegal By Kohnert, Dirk
  11. The Economics of Women's Rights By Michèle Tertilt; Matthias Doepke; Anne Hannusch; Laura Moutenbruck
  12. Sexual identity and Gender Gap in Leadership. A political intention experiment By Mourelatos, Evangelos; Krimpas, George; Giotopoulos, Konstantinos
  13. Income Misperception and Populism By Back, Camila; Spann, Martin

  1. By: Duchoslav, Jan; Kenamu, Edwin; Thunde, Jack
    Abstract: Do electoral considerations play a role in the targeting of humanitarian transfers? We analyze the targeting of direct cash and food transfers distributed in Malawi in response to an exceptionally poor harvest following a late and erratic rainy season of 2015-16. Combining household survey data on transfers with a remotely sensed measure of drought and with the results of the 2014 and 2019 parliamentary elections, we show that transfers were disproportionately targeted at marginal constituencies. Rather than distributing the transfers based solely on need or mobilizing its tribal base, the government attempted to persuade swing voters to support its candidates in the next elections. We found no evidence that this strategy was successful at increasing the vote of ruling party candidates in subsequent elections.
    Keywords: MALAWI; SOUTHERN AFRICA; AFRICA SOUTH OF SAHARA; AFRICA; hunger; cash transfers; political systems; disaster relief; elections; food transfers; political economy; voting
    Date: 2022
  2. By: Lagios, Nicolas (Université Libre de Bruxelles); Meon, Pierre-Guillaume (Free University of Brussels); Tojerow, Ilan (Free University of Brussels)
    Abstract: We study the electoral impact of protesting against the far right by investigating the demonstrations held during the 2002 French presidential elections against far-right candidate Jean-Marie Le Pen. Instrumenting rally attendance with rainfall while factoring in that some municipalities never host protests, we find that larger protests reduced both the number of votes for Le Pen and the number of abstentions, while increasing the number of votes for Chirac. Regarding the mechanisms behind these results, we show that protests reduced the social desirability of voting for Le Pen, the support for his policies, and generated spatial spillovers through local media.
    Keywords: protest, election, demonstration, far right, populism
    JEL: D72
    Date: 2022–09
  3. By: Dorine Boumans; Klaus Gründler; Niklas Potrafke; Fabian Ruthardt
    Abstract: Can one single political leader influence macroeconomic expectations on a global scale? We design a large-scale survey experiment among influential economic experts working in more than 100 countries and use the 2020 US presidential election as a quasi-natural experiment to identify the effect of the US incumbent change on global macroeconomic expectations. We find large effects of Joe Biden’s election on growth expectations of international experts, working through more positive expectations about trade. The electoral outcome particularly affected the expectations of Western allies and increased global economic uncertainty. Our findings suggest important political spillover effects in the formation of macroeconomic expectations.
    Keywords: US presidential elections, politicians, economic expectations, economic experts, survey experiment, causal inference
    JEL: A11 D72 O11
    Date: 2022
  4. 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
    JEL: D72 D91 L86
    Date: 2022
  5. By: Benjamin Marx (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique); Vincent Pons (Harvard University [Cambridge], CEPR - Center for Economic Policy Research - CEPR, NBER - National Bureau of Economic Research [New York] - NBER - The National Bureau of Economic Research); Vincent Rollet (MIT - Massachusetts Institute of Technology)
    Abstract: In most national elections, voters face a key choice between continuity and change. Electoral turnovers occur when the incumbent candidate or party fails to win reelection. To understand how turnovers affect national outcomes, we study the universe of presidential and parliamentary elections held since 1945. We document the prevalence of turnovers over time and we estimate their effects on economic performance, trade, human development, conflict, and democracy. Using a close-elections regression discontinuity design (RDD) across countries, we show that turnovers improve country performance. These effects are not driven by differences in the characteristics of challengers, or by the fact that challengers systematically increase the level of government intervention in the economy. Electing new leaders leads to more policy change, it improves governance, and it reduces perceived corruption, consistent with the expectation that recently elected leaders exert more effort due to stronger reputation concerns.
    Keywords: Elections,Turnovers,Democracy,Institutions
    Date: 2022–02
  6. By: Gustavo de Souza
    Abstract: I describe a structural method to quantify the contribution of different elements of social choice to the level of redistribution. Estimating a DSGE model with microdata on the support for redistribution, I find that if voters disregarded their ideological views on welfare policies, redistribution in the U.S. would increase 117%. Because ideology is a more important determinant of voting behavior than income, increasing voter turnout or capping campaign contributions would have a small effect on redistribution. Among the drivers of ideology, I find that racial animosity and distrust of the government contributes to an 80% and 44% smaller redistribution, respectively.
    Keywords: Redistribution; Prefereces for Redistribution; Dynamic Macro Models of Political-Economoy
    JEL: E69 H11 P16
    Date: 2022–10–05
  7. By: Bury, Yannick; Feld, Lars P.; Köhler, Ekkehard A.
    Abstract: Cooperative fiscal federalism needs a multi-level consent to decide on the allocation of intergovernmental transfers. We study how parliamentary representation of municipalities on the federal level influences the allocation of federal transfers to municipal governments under this type of federalism. Using a regression discontinuity design in close electoral races, we find that a directly elected member of the federal parliament, who belongs to the party that leads the federal government, induces higher infrastructure transfers from the federal government to a local jurisdiction. However, our results show that this effect only unfolds, if the parliamentarian's party is simultaneously leading the state government. Moreover, we identify party competition on the local level as motive behind the strategic use of federal funds. Thus, while supporting the swing voter hypothesis, our results suggest that federalism inherently entails restrictions for misusing intergovernmental transfers for political reasons.
    Keywords: Fiscal Federalism,Partisan Alignment,Vertical Transfers
    JEL: H71 H72 H77 E62
    Date: 2022
  8. By: Campos, Nauro F. (University College London); Coricelli, Fabrizio (Paris School of Economics); Frigerio, Marco (University of Siena)
    Abstract: This paper throws new light on the relationship between income and democracy. Using data for 162 countries over 1960-2018, we show that the causal relationship between political and economic development is U- shaped: "intermediate" political regimes significantly lead to inferior economic performance vis-à-vis both "democracies" and "autocracies." Our results suggest "intermediate" regimes decrease long run GDP per capita by about 20 percent. These effects are mainly driven by political instability, while other potential mechanisms, such as education, investment and inequality, lack comparable empirical support. These findings are robust to, among others, using night-lights instead of GDP, different democracy measures and estimators.
    Keywords: democracy, income, growth, political development, economic development, non-linearity
    JEL: C33 D72 F15 O43 P16
    Date: 2022–09
  9. By: Berliant, Marcus; Boyer, Pierre
    Abstract: This paper begins with a survey of the literature on the political economy approaches to labor income taxation. We focus on recent progress made by examining in detail the specific properties of non-linear taxes derived in the context of voting. Next, we present new results on the existence of majority voting equilibrium that unify work in the standard framework. Finally, we discuss how recent theoretical results help us uncover empirical patterns from the last 50 years in the US tax system, namely a sharp decrease in top marginal tax rates, the rise of the Earned Income Tax Credit (EITC), and increased progressivity in the middle of the income distribution.
    Keywords: Non-linear income taxation; Tax reform; Political economy; Optimal taxation; EITC
    JEL: C72 D72 D82 H21
    Date: 2022–10–13
  10. By: Kohnert, Dirk
    Abstract: Populist nationalism is on the rise in sub-Saharan Africa. Depending on the political orientation, it is both reinforced and confronted by social media and social movements. Nationalism also cements the longstanding rule of autocratic regimes in West Africa, particularly in Togo, Benin and Senegal. Supported by the commodification of the party system, autocrats set up a shadow state. They use populism to prop up their illegitimate rule and to destabilize the opposition. The internet and social media play a crucial role in the spread of fake news through the mostly state-controlled media. The Catholic Church also tried, with little success, to counteract the wave of nationalism. In Benin, for example, in 2019 the bishops of Cotonou called for a ‘fast on the lies that inundate and poison interpersonal and social relationships’. In Lomé, the bishops' conference condemned the systematic persecution of the opposition and the arrest of its leader, presidential candidate and former prime minister Agbeyome Kodjo. Senegal, like Benin, has long been marketed as a 'showcase of democracy' in Africa, including peaceful political transition. But things changed radically with the 2019 Senegalese presidential election, which brought new configurations. One of the main problems was political transhumance, which was elevated to the rank of religion with disregard for political morality. It threatened political stability and peace. In response, social networks of mostly young activists established in 2011 after the Arab Spring focused on campaigning for grassroots voters for good governance and democracy. They proposed a break with a political system they saw as neo-colonialist. Activists such as 'Y'en a marre' (literally 'I'm fed up') and other dissident social movements benefited from the country's particular social conditions, which favoured collective action. Should President Macky Sall opt for a third term in 2024, it would again pose a serious challenge to Senegalese democracy.
    Keywords: Dictatorship; governance; autocracy; state capture; devolution of power: multi-party democracy; social movements; social media; West Africa; Sub-Saharan Africa; Benin; Togo; Senegal; African Studies;
    JEL: E22 E24 F35 F51 F52 F54 H11 H75 K33 N17 N37 N47 O17 O57 Z13
    Date: 2022–10–09
  11. By: Michèle Tertilt (Universität Mannheim); Matthias Doepke (Northwestern University); Anne Hannusch (University of Mannheim); Laura Moutenbruck (University of Mannheim)
    Abstract: Two centuries ago, in most countries around the world, women were unable to vote, had no say over their own children or property, and could not obtain a divorce. Women have gradually gained rights in many areas of life, and this legal expansion has been closely intertwined with economic development. We aim to understand the drivers behind these reforms. To this end, we distinguish between four types of women's rights—economic, political, labor, and body—and document their evolution over the past 50 years across countries. We summarize the political-economy mechanisms that link economic development to changes in women's rights and show empirically that these mechanisms account for a large share of the variation in women's rights across countries and over time.
    Keywords: female suffrage, family economics, bargaining, political economy
    JEL: D13 D72 E24 J12 J16 N30 O10 O43
  12. By: Mourelatos, Evangelos; Krimpas, George; Giotopoulos, Konstantinos
    Abstract: The underrepresentation of women and homosexuals in leadership positions has been well documented, but the grounds for this need further investigation. We conduct a field and an online experiment to test a prominent theory about the sources of the sexual and gender gap in political leadership ambition: women's and homosexuals' higher aversion to engage to competitive environments. Within an experimental political environment as a context for our research, we employ two distinct subject sample pools - highly politically active individuals and workers from an online labor market. By controlling for a variety of internal and external factors and preference-based indicators, we establish that there are fundamental sexual and gender behavioral differences, stemming from differences in underlying psychological abilities and differences due to the nature of electoral competition. We find that priming individuals to consider the competitive nature of politics has a strong negative effect on women's and homosexuals' interest to run for a political office, but not on men's and heterosexuals' interest, hence significantly increasing the gender and sexual gap in leadership ambition. While on the online experiment the gender gap holds, surprisingly, we found that homosexuals' intention to participate in politics follows the opposite course.
    Keywords: sexual gap,Gender gap,leadership,politics,experiment
    JEL: D01 D91 C93
    Date: 2022
  13. By: Back, Camila (LMU Munich); Spann, Martin (LMU Munich)
    Abstract: We propose that false beliefs about the own current economic status are an important factor for explaining populist attitudes. Along with the subjects' receptiveness to right-wing populism, we elicit their perceived relative income positions in a representative survey of German households. We find that people with pessimistic beliefs about their income position are more attuned to populist statements. Key to understanding the misperception-populism relationship are strong gender differences in the mechanism: Misperception triggers income dissatisfaction for both men and women, but the former are much more likely to channel their discontent into affection for populist ideas.
    Keywords: perception; income; populism;
    JEL: D63 D72 D91 P16
    Date: 2022–10–25

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