nep-pol New Economics Papers
on Positive Political Economics
Issue of 2023‒10‒02
nine papers chosen by
Eugene Beaulieu, University of Calgary

  1. The Changing Polarization of Party Ideologies: The Role of Sorting By Satyajit Chatterjee; Burcu Eyigungor
  2. Political Sentiment and Innovation: Evidence from Patenters By Joseph Engelberg; Runjing Lu; William Mullins; Richard R. Townsend
  3. Learning from the Origins By Alexander Yarkin
  4. The Pervasive Influence of Ideology at the Federal Circuit Courts By Alma Cohen
  5. Immigration and Nationalism in the Long Run By Valentin Lang; Stephan A. Schneider
  6. Is There a Dividend of Democracy? Experimental Evidence from Cooperation Games By Thomas Markussen; Jean-Robert Tyran
  7. A farewell to welfare? Conceptualising welfare populism, welfare chauvinism and welfare Euroscepticism By Eick, Gianna Maria; Leruth, Benjamin
  8. Relationship between governance indicators and economic growth: a descriptive study By Alouani, Ahmed
  9. Women’s representation in parliament and tax mobilization By Hoang, Thon T.C.; Nguyen, Dung T.K.

  1. By: Satyajit Chatterjee; Burcu Eyigungor
    Abstract: U.S. congressional roll-call voting records show that as polarization of the two parties along the economic dimension changes, polarization along the social/cultural dimension tends to change in the opposite direction. A model of party competition within a two-dimensional ideology space is developed in which party platforms are determined by voters who compose the party. It is shown that if distribution of voter preferences is radially symmetric, polarization of party ideologies along the two dimensions are inversely related, as observed. The model gives a remarkably good quantitative account of the historically observed movements in polarization along the two dimensions.
    Keywords: Polarization; Primaries; partisanship; partisan politics; Political Economy; partisan sorting
    Date: 2023–02–28
  2. By: Joseph Engelberg; Runjing Lu; William Mullins; Richard R. Townsend
    Abstract: We document political sentiment effects on US inventors. Democratic inventors are more likely to patent (relative to Republicans) after the 2008 election of Obama but less likely after the 2016 election of Trump. These effects are 2-3 times as strong among politically active partisans and are present even within firms over time. Patenting by immigrant inventors (relative to non-immigrants) also falls following Trump’s election. Finally, we show partisan concentration by technology class and firm. This concentration aggregates up to more patenting in Democrat-dominated technologies (e.g., Biotechnology) compared to Republican-dominated technologies (e.g., Weapons) following the 2008 election of Obama.
    JEL: D72 J24 M5 O31
    Date: 2023–08
  3. By: Alexander Yarkin
    Abstract: How do political preferences and voting behaviors respond to information coming from abroad? Focusing on the international migration network, I document that opinion changes at the origins spill over to 1st- and 2nd-generation immigrants abroad. Local diasporas, social media, and family ties to the origins facilitate the transmission, while social integration at destination weakens it. Using the variation in the magnitude, timing, and type of origin-country exposure to the European Refugee Crisis of 2015, I show that salient events trigger learning from the origins. Welcoming asylum policies at the origins decrease opposition to non-Europeans and far-right voting abroad. Transitory refugee flows through the origins send abroad the backlash. Data from Google Trends and Facebook suggests elevated attention to events at the origins and communication with like-minded groups as mechanisms. Similar spillovers following the passage of same-sex marriage laws show the phenomenon generalizes beyond refugee attitudes.
    Keywords: immigration, social networks, spillovers, political attitudes, integration
    JEL: O15 Z13 D72 D83 P00 J61 F22
    Date: 2023
  4. By: Alma Cohen
    Abstract: This paper seeks to contribute to the long-standing debate on the extent to which the ideology of federal circuit court judges, as proxied by the party of the president nominating them, can help to predict case outcomes. To this end, I combine and analyze a novel dataset containing about 670, 000 circuit court cases from 1985 to 2020. I show that the political affiliation of judges is associated with outcomes, and thus can help to predict them, throughout the vast universe of circuit court cases – and not only in the ideologically contested cases on which prior empirical research has focused. In particular, I find an association between political affiliation and outcomes in each of six categories of cases in which the two litigating parties could be perceived by judges to have unequal power. In each of these six case categories, which together add up to more than 550, 000 cases, the more Democratic judges a panel has, the higher the odds of the panel siding with the seemingly weaker party. Furthermore, I identify evidence of polarization over time in circuit court decisions. Consistent with such growing polarization, in the important subset of published cases, the identified patterns are more pronounced in the last two decades of the examined period than earlier. Going beyond the very large sample of cases with parties of seemingly of unequal power, I identify how political affiliation can help to predict outcomes in most of the cases outside this sample. In particular, I show that panels with more Democratic judges are less likely than panels with less Democratic judges to defer to the lower-court decision in civil cases between private parties that seem to be of equal power. Altogether, my analysis shows that political affiliation can help to predict outcomes in over 90% of circuit court cases. Overall, my results highlight the pervasiveness with which – and the array of ways through which – the political affiliation of judges can help to predict the outcome of circuit court cases.
    JEL: D72 J15 J16 K0
    Date: 2023–07
  5. By: Valentin Lang; Stephan A. Schneider
    Abstract: During recent waves of immigration, support for nationalist parties has increased in many countries, but the political backlash against immigration differs strongly across regions. We identify an underlying cause for these differences by studying how local experience with immigration shapes nationalist sentiment and electoral reactions to current immigration in the long run. Our analysis draws on a natural experiment in post-war Germany, where a short-term demarcation of occupation zones led to a discontinuous and quasi-exogenous distribution of forced migrants. Across this border, the population share of migrants differed by 12 percentage points. Applying a spatial regression discontinuity design, we combine historical migration records with panel data at the municipality level for the 1925-2021 period. The results reveal a substantially weaker backlash against contemporary immigration in regions where more migrants settled in the late 1940s. This historical experience reduces the nationalist backlash by about 20 percent. High levels of immigration activate this effect over a period of at least 70 years. To study the mechanisms, we conduct a geocoded survey with a randomized experiment and open-ended questions in the study region. We find that both family history and local collective memory of successful immigrant integration contribute to these effects. The results of the randomized experiment are consistent with the natural experiment, revealing how experience with immigration can curb nationalism.
    Keywords: migration, nationalism, persistence, voting behavior
    JEL: D72 O15
    Date: 2023
  6. By: Thomas Markussen; Jean-Robert Tyran
    Abstract: Do democratically chosen rules lead to more cooperation and, hence, higher efficiency, than imposed rules? To discuss when such a “dividend of democracy” obtains, we review experimental studies in which material incentives remain stacked against cooperation (i.e., free-riding incentives prevail) despite adoption of cooperation-improving policies. While many studies find positive dividends of democracy across a broad range of cooperation settings, we also report on studies that find no dividend. We conclude that the existence of a dividend of democracy cannot be considered a stylized fact. We discuss three channels through which democracy can produce such a dividend: selection, signaling, and motivation. The evidence points to the role of “culture” in conditioning the operation of these channels. Accepting a policy in a vote seems to increase the legitimacy of a cooperation-inducing policy in some cultures but not in others.
    Keywords: voting collective decision making, public goods
    JEL: C90 D70 D90 H40
    Date: 2023
  7. By: Eick, Gianna Maria (University of Amsterdam); Leruth, Benjamin
    Abstract: This conceptual paper argues for the importance of studying three policy paradigms on welfare opposition: First, welfare populism, the opposition to welfare state policies and their administration that do not benefit the ‘common people’. Second, welfare chauvinism, the opposition to the inclusion of non-natives who live in a nation-state from welfare provisions. Third and finally, welfare Euroscepticism, the opposition to the harmonization of welfare policies at the European Union level. We argue that these paradigms have distinct causes and consequences that should be studied across countries in more detail, including a focus on their multidimensional nature and different political actors. And while these paradigms may not lead to a complete farewell to welfare, they most certainly have been shaping and will continue to shape welfare state recalibration. Precisely, we argue that due to welfare opposition, welfare states continue to be influenced by radical right and neoliberal logics instead of focusing on diminishing inequality. This paper concludes with avenues for future research.
    Date: 2023–08–30
  8. By: Alouani, Ahmed
    Abstract: In this article, the relationship between governance indicators and economic growth over the time period (1996-2017) will be theoretically and statistically examined. To do this, we looked at Tunisia's economy in the first section. In the second, we looked at the state of Tunisian governance. Finally, in the third, we looked at how governance indicators affected economic expansion. Using this method, we were able to demonstrate the beneficial effects of certain governance indicators on Tunisia's economic growth, including political stability, the rule of law, and regulatory quality. So, the fight against corruption can help the economy grow even more. On the other hand, other governance metrics like accountability, voice, and government effectiveness are not having the expected growth effects. Political leaders must therefore enhance governance metrics like political stability and corruption management. Since 2011, Tunisia's successive governments have persisted in trying to put the country on the path to long-term, sustainable growth. Although the improvements are still straightforward, the measures are growing.
    Keywords: Political stability, economic growth, rule of law, good regulation, governance
    JEL: G38 K29 M29
    Date: 2023–08–29
  9. By: Hoang, Thon T.C.; Nguyen, Dung T.K.
    Abstract: Some studies show that the higher share of female politicians enhances the implementation of policies that benefiting for women such as childcare services, childcare spots, antenatal and childhood health services, and early education. As a result, they encourage women to participate in labor market. It is also suggested that women have higher tax compliance level and countries having higher proportion of women undergo lower corruption level. This research attempts to examine the relationship between female politicians and tax revenue mobilization. If the positive relationship is proven, there is a fiscal reason to support female politicians and the policies benefiting women. In this study, panel data of 137 countries from 1998 to 2019 will be combined with fixed effect models. The results show the positive influence of the female politicians on tax mobilization. The positive influence is still significant when year effect, interaction variables with income groups, and exponents are included in the model. The study also indicates that while the presence of female politicians in parliament has no discernible impact on tax revenue in high-income groups, in other income groups, a 1 percent increase in female representation in parliament corresponds to a 0.1 percent increase in tax revenue as a percentage of GDP.
    Keywords: Female politicians, tax mobilization, fixed effect, high-order polynomial
    JEL: H20 J16
    Date: 2023–08–17

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