nep-pol New Economics Papers
on Positive Political Economics
Issue of 2024‒01‒08
nine papers chosen by
Eugene Beaulieu, University of Calgary

  1. Democracy and The Opioid Epidemic By Carolina Arteaga; Victoria Barone
  2. The Voting Premium By Doron Y. Levit; Nadya Malenko; Ernst G. Maug
  3. Winner's purse: Presidents and gobernors in Argentina during 2003-2019 By Freille Sebastián
  4. Political salience and regime resilience By Sebastian Schweighofer-Kodritsch; Steffen Huck; Macartan Humphreys
  5. Temporary Disenfranchisement Revisited: A Report from the 2023 Montréal Replication Games on the Robustness of Recent Findings in the APSR By Frese, Joris; Gkotinakos, Alexandros Christos; Grau, Pau; Hepplewhite, Matthew
  6. When scapegoating backfires: The pitfalls of blaming migrants for a crisis By Michela Boldrini; Pierluigi Conzo; Willem Sas; Roberto Zotti
  7. Assessing Bias in LLM-Generated Synthetic Datasets: The Case of German Voter Behavior By von der Heyde, Leah; Haensch, Anna-Carolina; Wenz, Alexander
  8. Does Foreign Direct Investment Promote Political Stability ? Evidence from Developing Economies By Assi Okara
  9. Representative Policy-Makers? A Behavioral Experiment with French Politicians By Roberto Brunetti; Matthieu Pourieux

  1. By: Carolina Arteaga; Victoria Barone
    Abstract: This paper estimates the effects of the opioid epidemic on political outcomes by leveraging rich geographic variation in exposure to the crisis. We study its effect on the Republican vote share in House and presidential elections from 1982 to 2020. Our results suggest that greater exposure to the opioid epidemic continuously increased the Republican vote share, starting in the early 2000s. This higher vote share translated into additional seats won by Republicans in the House from 2014 until 2020, as well as House members holding more conservative views. These effects are explained by voters changing their views rather than compositional changes.
    Keywords: Opioids, Mortality, Voting, Polarization
    JEL: D72 I12 I18 J13
    Date: 2023–12–21
  2. By: Doron Y. Levit; Nadya Malenko; Ernst G. Maug
    Abstract: This paper develops a unified theory of blockholder governance and the voting premium, in a setting without takeovers and controlling shareholders. A voting premium emerges when a minority blockholder tries to influence the composition of the shareholder base by accumulating votes and buying shares from dissenting shareholders. Empirical measures of the voting premium do not reflect the value of voting rights or voting power. A negative voting premium results from free-riding by dispersed shareholders on the blockholder’s trades. Conflicts between dispersed shareholders and the blockholder endogenously increase the liquidity of voting shares, but do not necessarily increase the voting premium.
    JEL: D72 D74 G34
    Date: 2023–11
  3. By: Freille Sebastián
    Abstract: In this paper we study the relationship between electoral outcomes for both federal and state level executive elections. Electoral outcomes for different offices in multi-tiered systems are likely to be mutually influenced through multiple channels. We explore two of this channels in this paper: institutional design and coattail effects. Traditionally, coattail effects have been studied between executive and legislative elections for the same government level. Instead, we explore both coattail effects and vote congruence for different-level office. Using data disaggregated at the department-level comprising 5 (five) elections during 2003-2019, we examine the relationship between votes for the elected President and governor in every district. We find evidence of vote dissimilarity between elected Presidents and governors and this is particularly strong when the national executive election is contested. Elected Presidents tend to increase their district-level relative electoral strength vis-a-vis elected gobernors regardless of party and coalition. This is consistent with anecdotal evidence and insights on the characteristis of coalition-building between national and sub-national governments.
    JEL: H77 P00
    Date: 2023–11
  4. By: Sebastian Schweighofer-Kodritsch; Steffen Huck; Macartan Humphreys
    Abstract: We introduce political salience into a canonical model of attacks against political regimes, as scaling agents’ expressive payoffs from taking sides. Equilibrium balances heterogeneous expressive concerns with material bandwagoning incentives, and we show that comparative statics in salience characterize stability. As main insight, when regime sanctions are weak, increases from low to middling salience can pose the greatest threat to regimes – ever smaller shocks suffice to drastically escalate attacks. Our results speak to the charged debates about democracy, by identifying conditions under which heightened interest in political decision-making can pose a threat to democracy in and of itself.
    Keywords: political conflict, salience, democracy, sanctions
    JEL: C72 D74 D91
    Date: 2023–12–15
  5. By: Frese, Joris; Gkotinakos, Alexandros Christos; Grau, Pau; Hepplewhite, Matthew
    Abstract: Leininger et al. (2023) study the political consequences of temporary disenfranchisement. Taking advantage of differentiated voting elegibility thresholds applying in different elections in Germany, they analyze how first-time voters react when losing eligibility in a follow-up election. They exploit this setting in a difference-in-differences design using panel data. They find that temporary disenfranchisement decreases perceived external efficacy by 0.19 points on a five-point Likert scale and satisfaction with democracy by 0.14 points. Both results are statistically significant at the five-percent level. In contrast, internal efficacy and political interest remain unaffected by the treatment, and regaining voting eligibility is not associated with statistically significant changes in respondents' attitudes. This report focuses on the computational reproducibility and robustness replicability of these findings. To assess the paper's reproducibility, we first attempt to reproduce the paper's estimates and figures using the author's replication materials. In a second step, we perform several robustness checks by means of alternative difference-in-differences specifications using coarsened exact matching and entropy balancing, and a closer examination of panel attrition. Overall, we find complete reproducibility of the original replication materials. Our robustness checks confirm the sign congruence and significance of coefficients reported in the original paper. We raise the issue of potential bias due to differential panel attrition rates between treated and untreated respondents.
    Keywords: Replication, Matching, Attrition
    Date: 2023
  6. By: Michela Boldrini; Pierluigi Conzo; Willem Sas; Roberto Zotti
    Abstract: In times of hardship, politicians often leverage citizens’ discontent and scapegoat minorities to obtain political support. This paper tests whether political campaigns scapegoating migrants for a health crisis affect social, political, and economic attitudes and behaviors. Through an online nationally-representative survey experiment in Italy, we analyze the effects of such narratives through information-provision treatments, which include facts also emphasizing the alleged health consequences of ongoing immigration. Results show that narratives associating immigration with health threats do not generate sizeable add-on effects compared to those based on immigration only. If anything, they increase disappointment towards co-nationals, reduce institutional trust, and undermine partisanship among extreme-right supporters. Results are consistent with a theoretical framework where party credibility and support, and institutional trust are influenced by political discourse. Our experiment underpins the prediction that political campaigns based on extreme narratives can be ineffective or socially and politically counterproductive, providing an example of how populism can backfire.
    Keywords: Immigration, Pandemic crisis, Survey experiment, Socio-political attitudes, Institutional trust, Anti-immigrant narratives, Informational treatments, Political messaging, Populism
    Date: 2023
  7. By: von der Heyde, Leah (LMU Munich); Haensch, Anna-Carolina; Wenz, Alexander (University of Mannheim)
    Abstract: The rise of large language models (LLMs) like GPT-3 has sparked interest in their potential for creating synthetic datasets, particularly in the realm of privacy research. This study critically evaluates the use of LLMs in generating synthetic public opinion data, pointing out the biases inherent in the data generation process. While LLMs, trained on vast internet datasets, can mimic societal attitudes and behaviors, their application in synthesizing data poses significant privacy and accuracy challenges. We investigate these issues using the case of vote choice prediction in the 2017 German federal elections. Employing GPT-3, we construct synthetic personas based on the German Longitudinal Election Study, prompting the LLM to predict voting behavior. Our analysis compares these LLM-generated predictions with actual survey data, focusing on the implications of using such synthetic data and the biases it may contain. The results demonstrate GPT-3’s propensity to inaccurately predict voter choices, with biases favoring certain political groups and more predictable voter profiles. This outcome raises critical questions about the reliability and ethical use of LLMs in generating synthetic data.
    Date: 2023–12–01
  8. By: Assi Okara (CERDI - Centre d'Études et de Recherches sur le Développement International - IRD - Institut de Recherche pour le Développement - CNRS - Centre National de la Recherche Scientifique - UCA - Université Clermont Auvergne)
    Abstract: This paper investigates the potential of Foreign Direct Investment (FDI) to counter socio-political instability, one of the most pressing challenges faced by developing countries. Socio-political (in)stability is approached from an institutional perspective and linked to one particular type of FDI, greenfield FDI, for its more direct socio-economic externalities and their influences on greed and grievance. The issue of causality is primarily addressed using a gravity-based instrumental variable for FDI, taking advantage of bilateral greenfield projects data. The empirical results using data over the period 2003-2017 for a large sample of developing countries show that FDI favors institutional development not only in terms of overall socio-political stability but also human rights compliant socio-political stability. The results are robust to a range of specifications and alternative identification strategies, as well as to a series of sensitivity tests. Overall, this study highlights the promotion of political stability as another channel through which FDI can contribute to development.
    Keywords: Greenfield FDI, institutions, political stability, developing countries
    Date: 2022–02
  9. By: Roberto Brunetti (Université Lumière Lyon 2, GATE UMR 5824, F-69130 Ecully, France and Univ Rennes, CNRS, CREM-UMR6211, F-35000 Rennes, France); Matthieu Pourieux (Univ Rennes, CNRS, CREM-UMR6211, F-35000 Rennes, France)
    Abstract: This study leverages an online behavioral experiment to analyze political representation—whether politicians’ decisions align with citizens’ preferences over the same issue—and behavioral representation—whether politicians’ decisions align with citizens’ decisions within the same decision environment. We recruited 760 local politicians and 655 non-politicians in France to participate as policy-makers in a taxation-redistribution game. In the game, two policy-makers compete to choose a flat tax rate for a group of citizens, who are selected from the French general population and state their preferred tax rate. We exogenously manipulate (i) the information provided to policy-makers about citizens’ preferred tax rates and (ii) the degree of competition between policy-makers. Finally, we measure policy-makers’ beliefs regarding both citizens’ preferences and their competitor’s choice. We observe that policy-makers positively react to the information, but they often deviate from it, which can be mostly explained by their beliefs about both citizens’ preferences and their competitor’s choices. Varying the degree of political competition has no impact on these results. Finally, we find that politicians believe citizens want lower tax rates and are more confident in their beliefs than non-politicians. Once beliefs are accounted for, we observe little differences between the two groups within the game. Our findings suggest that policy-makers act as pro-social agents who implement citizens’ preferences based on their beliefs when they lack information about these preferences.
    Keywords: Representation, Politicians’ Behavior, Online Experiment, Taxation-Redistribution
    JEL: D31 P19 H24 H79 C90
    Date: 2023

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