nep-pol New Economics Papers
on Positive Political Economics
Issue of 2022‒12‒19
six papers chosen by
Eugene Beaulieu
University of Calgary

  1. Misrepresentation and Migration: Differences between Voters and Politicians in Sweden By Kärnä, Anders; Öhberg, Patrik
  2. The role of majority status in close elections studies By Marta Crispino; Matteo Alpino
  3. Public Preference Formation Towards Sustainable Global Supply Chains Policy By Kolcava, Dennis; Smith, E. Keith; Bernauer, Thomas
  4. Replication of "Re-Assessing Elite-Public Gaps in Political Behavior" by Joshua Kertzer By Guntermann, Eric; Lenz, Gabriel S.
  5. Protectionism, bilateral integration, and the cross section of exchange rate returns in US presidential debates By de Boer, Jantke; Eichler, Stefan; Rövekamp, Ingmar
  6. Aid's impact on democracy By Miguel Niño-Zarazúa; Ana Horigoshi; Rachel M. Gisselquist

  1. By: Kärnä, Anders (Research Institute of Industrial Economics (IFN)); Öhberg, Patrik (University of Gothenburg)
    Abstract: Normative theories of representative democracy imply that politicians should be better informed of the consequences of a policy than ordinary voters. However, in real life, politicians can have strong convictions that risk blinding them to arguments against their positions. Policy engagement can lead politicians into motivated reasoning whereby they dismiss voters’ preferences and resist information counter to their own policy position. In this paper, we argue that Sweden’s generous migration policy is an example of a case where politicians’ policy engagement led them to motivated reasoning and to a rather optimistic view of the implications of welcoming a large influx of refugees. We show that Swedish politicians favoured a much more generous policy towards accepting refugees than their own voters. Despite limited evidence that a generous refugee policy is economically favourable in the long run, politicians on average held that belief.
    Keywords: Political Misrepresentation; Immigration Policy; Moral Psychology; Political Failure
    JEL: O15 P16 P35
    Date: 2022–11–23
  2. By: Marta Crispino (Bank of Italy); Matteo Alpino (Bank of Italy)
    Abstract: Many studies exploit close elections in a regression discontinuity framework to identify partisan effects, i.e. the effect of having a given party in office on the outcome. We argue that, when conducted on single-member districts, such analysis may identify a compound effect: the partisan effect, plus the majority status effect, i.e. the effect of being represented by a member of the legislative majority. We provide a simple strategy to disentangle the two effects, and test it with simulations. Finally, we show the empirical relevance of this issue using real data.
    Keywords: partisan effect, single-member districts, regression discontinuity design
    JEL: C21 D72
    Date: 2022–11
  3. By: Kolcava, Dennis; Smith, E. Keith; Bernauer, Thomas
    Abstract: Effectively governing environmental and social externalities throughout the global economy poses challenges for democratic policy-makers in the court of public opinion. Following the median voter model, as the stringency of policy proposals increases, support rises amongst some citizens and falls amongst others. We argue informational disclosure-based governance presents a potential strategy to mitigate this zero-sum logic as citizens discount policy costs while expecting substantive benefits. We focus on political efforts to increase sustainability throughout global supply chains, drawing on two original survey experiments with representative samples in the 12 largest high-income importing economies (N=24,000). Indeed, at higher levels of policy stringency, citizens expect greater benefits than costs. Further, we find that expected benefits are more strongly associated with support than costs. Lastly, we note how policy stringency promotes convergence of expected benefits across the political ideological spectrum. Hence, our findings provide insights into public preference formation towards the globalization-sustainability nexus.
    Date: 2022–11–15
  4. By: Guntermann, Eric; Lenz, Gabriel S.
    Abstract: Kertzer (2022) conducts a meta-analysis of parallel experiments on samples of political elites and ordinary citizens. He examines whether the average treatment effect for elites is significantly different from the average treatment effect for citizens, finding that only 19 of 162 (11.7%) difference-in-difference estimates are statistically significant after adjusting for the false discovery rate. He also finds that elites and masses hold similar foreign policy attitudes after controlling for their demographic characteristics. In this replication report, we begin by running robustness and heterogeneity tests for the first claim. We find that the results survive many robustness tests. We also find, however, that only a small number of the these treatments significantly affected masses (N=28) or elites (N=30). This low rate suggests the possibility that almost all of these experiments failed to successfully manipulate either masses or elites. If so, we may not be able to conclude that masses and elites respond similarly to experiments with confidence until political scientists produce more experiments with actual treatment effects or with successful manipulation checks in cases of null effects. In the second part of this replication report, we conceptually replicate the second Kertzer analysis, finding a strong correlation between elite and mass political decisions and attitudes, thus confirming Kertzer's analysis.
    Date: 2022
  5. By: de Boer, Jantke; Eichler, Stefan; Rövekamp, Ingmar
    Abstract: We study the impact of US presidential election TV debates on intraday exchange rates of 96 currencies from 1996 to 2016. Expectations about protectionist measures are the main transmission channel of debate outcomes. Currencies of countries with high levels of bilateral foreign trade with the US depreciate if the election probability of the protectionist candidate increases during the debate. We rationalize our results in a model where a debate victory of a protectionist candidate raises expectations about future tariffs and reduces future net exports to the US, resulting in relative depreciation of currencies with high bilateral trade integration.
    Keywords: Exchange Rates,US Presidential Elections,TV Debates,Protectionism,Bilateral Trade Integration
    JEL: F31 G15 G14 D72
    Date: 2022
  6. By: Miguel Niño-Zarazúa (Department of Economics, SOAS University of London & United Nations University - World Institute for Development Economics Research (UNU-WIDER)); Ana Horigoshi (Universite Paris Dauphine/PSL); Rachel M. Gisselquist (United Nations University - World Institute for Development Economics Research (UNU-WIDER))
    Abstract: This paper investigates the impact of foreign aid on democratic outcomes using a panel of countries for the period between 1995 and 2018. In so doing, it speaks to a major critique of foreign aid, which is that it negatively impacts democratic governance. The analysis distinguishes between developmental aid and democracy aid, and examines democracy aid to specific sectors, in order to explore variation across different aid types. It draws on the Organisation for Economic Co-operation and Development’s (OECD) Creditor Reporting System (CRS) data on foreign aid and indices of democracy from the Varieties of Democracy project, employing a combination of a maximum likelihood estimation and structural equation modelling (ML-SEM) model and fixed effects models. Overall, using a more extensive set of data and methods than previous analyses, we offer comprehensive evidence pointing to aid having a positive if modest impact on democratic outcomes. Our analysis suggests this effect is more significant for democracy aid than developmental aid, but there is no evidence of negative impact for either. These results are robust to multiple specifications
    Keywords: foreign aid; democracy; development
    JEL: D72 F35 F55
    Date: 2022–02

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